WHILE WELCOMING the government’s decision to subsidise the rice trade by another Bt20 billion, paddy growers and analysts yesterday said the move might be too little and short-term to tackle problems in the entire system.
The Rice Policy Management Committee yesterday increased its budget to help farmers sell paddy Hom Mali, or jasmine, rice at Bt13,000 per tonne, up from the previous agreement of Bt11,525 per tonne.
Commerce Minister Apiradi Tantraporn said the upward revision of the subsidy was due to the government’s aim of stimulating the market price to help farmers.
Under the additional subsidy, the government is expected to spend another Bt20 billion over the previous budget of Bt35.9 billion.
The subsidy measure is designed to only help paddy farmers growing Hom Mali rice, allowing them to delay selling rice during the harvest season when the price will be low.
The measure is aimed at keeping 2 million tonnes of rice paddy off the market, from a total expected national yield of 10 million tonnes to be harvested during the current season.
According to the committee, Bt9,500 of the Bt13,000 subsidy will be paid to farmers to store their paddy for between three and six months. The remaining subsidy will cover harvesting, quality improvements and storage costs.
The subsidy is capped at 10 rai (1.6 hectares) of paddy per household. Rice farmers who have their own barns for storage will be paid Bt1,500 per tonne, up to a maximum of 15 rai.
The financial assistance will be facilitated by the Bank for Agriculture and Agricultural Cooperatives (BAAC) starting today until the end of February.
At a press briefing, Prime Minister Prayut Chan-o-cha said the |government had to partly support the subsidy since the BACC was only allowed to provide credit support.
“Please understand that we have a limited national budget. Also, please don’t compare our offers to those of previous times [of rice-pledging schemes],” he said. “We can act only to the extent of the law. We can’t break them.”
Prayut said all sectors should be more self-reliant, citing declining the rice markets around the globe, lower foreign demand and rising production costs.

Price guarantee proposed
Those factors would also require farmers to help themselves more, he said.
Meanwhile, the Commerce Ministry insisted that it would suspend its planned disbursement of rice until the end of the harvest season to prevent the market price from dropping too much due to increased supply. The government holds about 8.4 million tonnes of rice in stock.
Rice farmers from various parts of the country said they were pleased with the government’s subsidy because it would push up the price in the market – but some complained that the measure was not enough.
Rangsit University Faculty of Economics dean Anusorn Tamajai said the scheme would not help the farmers enough and suggested that the government should instead apply a rice price guarantee, which would be of more benefit.
“It should be cautioned that the rice price guarantee scheme should be used for only a short period of time, just to relieve the financial burden for farmers during the decrease in the price of crops,” Anusorn said.
“In addition, the government should be careful when implementing this scheme or setting the guarantee price too high to avoid the market from being monopolised by the government.
“This would lead to a price distortion and damage the economy and market system.”
As a long-term measure, he suggested that the government empower the farmers to give them have more bargaining power by encouraging them to form agricultural cooperatives.