Rice industry, already lost the title of world’s top exporter to India, is heading for disaster in the next few years due to a lack of proper strategic management of the rice-pledging scheme and the country’s exports, according to the Thai Rice Exporters Association.

Rice farming has long been the mainstay of Thailand. Rice farmers were once dubbed the backbone of the nation. But as a new generation shuns taking over their ancestors’ career, is Thailand’s traditional vocation under threat in the heartland of this once agricultural country?

According to statistics from the Bank for Agriculture and Agricultural Co-operatives BAAC in the central province of Ayutthaya, there are some 32,000 registered farmers. The numbers of ‘chao nah’ people of the rice fields in Thai is declining in this former seat of Siam’s monarchs, and today most rice farmers do not own the land they work.

Vietnam rice paddy field
High rice price from Thailand helped other exporters such as Vietnam and India to gain market shares. Picture : adb.org

Sutin Attanitee has been a rice farmer for his entire life. He’s 72 years old, but still in debt and doesn’t have much land of his own. With his minimal income, he managed to pay his children’s school tuition fees until their graduation. He said he will continue rice farming until he can’t do it any more.

Many rice farmers’ children sell their parents’ land to investors for property development

Despite being proud of his own career, Sutin realised his offspring would not want to continue his profession, for they experienced the hardship of their father from hard work, unstable income, and debt.

“Of course, I would want my kids to do what I do. But I don’t think they would. If you have a comfortable job, who would want to be engaged in rice farming? I’ve been doing this my whole life and I still have huge debts,” Sutin said.

The Thai Rice Foundation is under Royal Patronage. Its secretary-general Kwanjai Komes said the problem of the shrinking number of Thai rice farmers has affected the country in many dimensions, such as reduced rice exports and unstable rice prices.

Thailand has now lost its ability to compete in rice exports to India and Vietnam. In the future Thailand will also have to import rice from neighbouring countries, she believes.

For the first time in half a century, Thailand has lost its position as top rice-exporting nation.

Kwanjai suggests that the government encourage using new technology in rice farming, create new dimensions, and encourage positive attitudes among rice farmers and the younger generation so they understand that rice farming can be a profitable business and not as difficult as they think.

“We have to create the ability of our rice farmers to compete, or other people will grow rice for us, which they can. This is something the foundation and I are very worried about. We must find measures and solutions to the problem.

We have to learn to understand first the impact of this issue, which must be studied thoroughly,” Kwanjai emphasised.Also expressing a warning to the country, University of Thai Chamber of Commerce UTCC Economic and Business Forecasting Center director Dr Thanawat Polwichai recently said he is concerned there will be no more Thai rice farmers in another 10 years.The average age of Thai rice farmers is currently 50 years old.

They can grow rice for another decade, but their children don’t want to continue their parents’ profession. Many rice farmers’ children sell their parents’ land to investors for property development such as housing projects and golf courses.

Thailand recently lost the title of world’s top exporter to India

Rice industry, already lost the title of world’s top exporter to India, is heading for disaster in the next few years due to a lack of proper strategic management of the rice-pledging scheme and the country’s exports, the Thai Rice Exporters Association said yesterday.

As of July 10, India had eclipsed Thailand as the world’s largest rice exporter, with year-to-date overseas shipments of 3.61 million tonnes.

Thai exports in the period slumped by 45.8 per cent to 3.6 million tonnes, while Vietnam is breathing down the Kingdom’s neck in third place with an impressive 3.52 million tonnes.

This is the first time in half a century that Thailand has lost its position as top rice-exporting nation.

Association president Korbsook Iamsuri said the government should neither rely on the unexpected, such as competitor nations finding themselves faced with a tough export situation, nor spend a huge budget on pledging without proper concern for the trading situation.

If the government continues on the current path,

“the Thai rice industry will soon collapse, as trading would be in limbo, while farmers would face a domino effect and be unable to sell their rice because of millers being faced with excess stocks”, she said. “And the government would lack the funds to continue its subsidisation of the next few crops.”

TDRI says pledging puts entire industry at risk.

The government rice pledging programme is rife with corruption and inefficiency, putting the entire industry at risk unless changes are made, local economists and rice experts said.

One of the most important economic policies of the Yingluck Shinawatra government, the programme represents a guarantee by the state to purchase unlimited amounts of rice from local farmers at prices as much as 50% higher than market value.

But economists said the programme, which has cost the state more than 200 billion baht to date, is one of the worst-designed and costliest policies enacted by the Yingluck government as it nears the end of its first year in office.

Ammar Siamwalla, honorary economist at the Thailand Development Research Institute (TDRI), said the rice pledging scheme was “pro-rich and anti-poor”, with high pledging prices raising the cost of living for the entire public.

“The policy is biased in favour of farmers who can produce more rice compared with those who produce less,” he said yesterday. “The policy has also added to the hardship faced by the poor who must purchase rice for their own consumption.”

Sources:  The future of Thai rice farming: Are Thai rice farmers losing heart?.

Rice scheme is ‘pro-rich’; TDRI says pledging puts entire industry at risk. [Bangkok Post Aug 8, 2012]

and Thai Rice exporters website: http://www.thairiceexporters.or.th/default_eng.htm

About the author

Bangkok Correspondent at Siam News Network

Bangkok Correspondent for Siam News Network. Editor at Thailand Business News

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