Thailand implements 8.36 billion baht plan to stabilise rice prices

The National Rice Policy and Management Committee has introduced three strategic measures to stabilise rice prices amidst concerns of potential oversupply during the harvest season. By maintaining a balance between demand and supply, these initiatives aim to prevent a price drop in this year’s rice crop.

Commerce Minister Pichai Naripthaphan announced that the first measure entails an 8.36 billion baht (US$244 million) rice-pledging programme, designed to provide a subsidy of 1,500 baht (US$45) per tonne of rice pledged.

This subsidy will be divided, with 1,000 baht (US$30) allocated to the cooperative managing the pledging process and the remaining 500 baht (US$15) directed to the farmers themselves.

“During the scheme, which runs until February 28 next year, farmers can pledge their rice for a period ranging from one to five months,” Pichai said after a meeting of the national committee on November 8.

In addition to the pledging scheme, rice farmers have the option to secure loans from the Bank for Agriculture and Agricultural Cooperatives (BAAC). These loans range from 9,000 to 12,500 baht (US$263 to 365) per tonne, depending on the type of rice pledged under the government’s programme.

Notably, the loan amount for Hom Mali rice has increased to 12,500 baht (US$365) per tonne from the previous 12,000 baht (US$360).

The second measure focuses on providing loans to rice farmer organisations, which will aggregate rice from individual farmers and pledge substantial quantities to the government to secure favourable terms. For this purpose, 656.25 million baht (US$19 million) has been allocated, to pledge a total of 1 million tonnes of rice, said Pichai.

“Under this programme, agricultural cooperatives will contribute 1% towards the interest rate of the loan, while the government will cover 3.5%.”

These loans will be available until September 30 next year, with an interest subsidy period capped at fifteen months, reported Bangkok Post.

The third measure involves a support programme for private rice warehouse operators participating in the rice-pledging scheme. The government will subsidise 3% of the interest on loans that these operators incur, provided they assist in managing pledged rice stocks for durations between two and six months.