BANGKOK, Aug 28 – Deputy Prime Minister/Finance Minister Kittiratt Na-Ranong said today that government intervention to shore up rubber prices, as demanded by Thailand’s planters, would be too costly and contradict the operation of the market system.
Nonetheless, he promised to issue measures to boost rubber prices in the long run and urged planters to call off their protest.
He said a set of long-term and short-term solutions on rubber prices, proposed by the Natural Rubber Policy Committee, would be sent to the Cabinet next Tuesday for approval.
Rubber growers countrywide vowed to stage simultaneous protests, North to South, on Tuesday.
The deputy prime minister said the Bank of Agriculture and Agricultural Cooperatives (BAAC) would support growers in processing rubber sheets to add value. The BAAC will allocate Bt5 billion for soft loans to planters in their investments.
The Government Savings Bank (GSB) will cooperate with commercial banks to lend to major rubber manufacturers to upgrade their machinery to produce rubber products such as gloves.
The bank will set aside Bt15 billion for the purpose.
Mr Kittiratt said the rubber export tax fund, currently holding more than Bt10 billion from the Bt2/kg levy on rubber exports, would provide a financial incentive to growers who cull rubber trees older than 25 years, covering more than an estimated 1 million rai nationwide.
Growers replanting rubber trees would receive a lower subsidy than those planting oil palms, he said, explaining that the move was to reduce the volume of natural rubber in the local market.
The government will not release about 100,000 tonnes from its stock to the market for the time being, he said.
Mr Kittiratt said the Energy Ministry was instructed to encourage using palm oil by building a 500-1,000 megawatt power plant using biodiesel from palm oil in the next few years.
The ministry should also support the use of B10 biodiesel, developed from B5 and B7, at gas stations next year, he said.