The caretaker government has been advised to urgently release 18 million tonnes of rice from the state stockpiles to secure money to pay farmers.
Att Pisanwanit, director of the Center for International Trade Studies (ITS) of the University of the Thai Chamber of Commerce (UTCC), said the government should accept losses by selling rice at US$350-400 per tonne, lower than the price currently offered by Vietnam, to earn about Bt200 billion which should be more than sufficient to pay the current Bt130 billion overdue payments.
The government can spend the remaining Bt70 billion raised to help farmers in other agricultural products such as rubber and tapioca, he said.
Att, dean of the UTCC Faculty of Economics, said that in the last decade since the Thaksin Shinawatra government in 2001, the Thai government has allocated a total of Bt1.5 trillion to help farmers and the Yingluck Shinawatra government has become the biggest spender at Bt700 billion, or more than half of budget expenses.
Production costs for Thai farmers between 2006 and 2012 have increased 60 percent, from Bt4,000/rai to Bt9,000/rai but the yield per rai has not been higher.
Thailand’s yield per rai for rice production is only one-third of the Vietnamese, he said, adding that Thai farmers produce 450 kg of rice per rai while the Vietnam’s rice production is one tonne per rai.
Att said the government should adjust its long-term assistance policy for farmers by refraining from rice trading intervention and offering appropriate assistance options for farmers.