The Thai cabinet approved rice price intervention measures today, aimed at discouraging farmers from rushing to sell their crops to rice traders or millers, but to store their harvests in barns of their cooperatives and to sell it when the price is right.

The cabinet has decided to set aside 55 billion baht, about 44 billion through the Bank of Agriculture and Agricultural Cooperatives (BAAC), to be extended as credit or loans to farmers’ associations, cooperatives and farmers who have their own barns, to buy paddy and to hold the unmilled grain for 4-5 months, then selling it to millers when it is more profitable.

Government spokesman Chai Wacharonke said, through these measures, it is estimated that about four million, out of a total of 10 million tonnes of the 2023-24 rice crop, are to be stored by farmers’ cooperatives and farmers.

The cabinet has set the amount of credit to be extended to farmers’ cooperatives and farmers who have their own rice barns, in accordance with the rice variety:

• 12,000 baht for a tonne of Hom Mali paddy
• 10,000 baht per tonne of Pathum Thani Hom Mali
• 9,000 baht per tonne of normal paddy
• 10,000 baht per tonne of sticky rice paddy

Additionally, the cabinet also agreed to a 1,000 baht fee for each tonne of paddy stored by cooperatives and 500 baht/tonne for paddy stored by individual farmers with their own barns.

The BAAC will charge cooperatives 4.85% interest on credit extended to them, but the government will shoulder 3.85% interest on their behalf.

Chai said that cooperatives will buy directly from farmers of Hom Mali paddy with 25% humidity at 12,200 baht per tonne. When the paddy is sold to millers later at a profit, the farmers will be paid an extra of 500 baht/tonne by the cooperatives.