CHIANG RAI – Rice farmers in Thailand should merge rice plots and make use of farm machinery to improve rice yield and reduce production costs, according to the Thailand Development Research Institute (TDRI) and Thailand’s caretaker agriculture minister.
The Thai government buys paddy rice from farmers at prices around 40% higher than market prices under the rice mortgage program which started in 2011 to boost farmer income. However, this has led to a sharp decline in rice exports. According to the Thai Rice Exporters Association (TREA) President, Thailand has lost export competitiveness in recent years and traditional buyers of Thai rice such as the Philippines and Indonesia have shifted to rivals such as Vietnam due to high prices of Thai rice.
The TDRI representative Nipon Poapongsakorn says the rice mortgage program should not be continued as global prices are likely to decline in 2014 and in coming years due to declining rice consumption. Instead, he suggests, Thai rice farmers should improve efficiency to reduce production costs.
The caretaker agriculture minister Yukol Limlamthong told local sources that Thai rice faces increasing competition from Myanmar, Cambodia and Laos in addition to Vietnam. He says that rice productivity is as low as 1.8 tons per hectare in some parts of Thailand and the government zoning policy will help improve productivity and enable Thai rice to compete globally. However, farmer representatives in Thailand say that the zoning policy is unlikely to reduce increasing production costs of rice farming in Thailand.
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