The National Rice Policy and Management Committee has approved three initiatives aimed at balancing the demand and supply of rice. This will help prevent a drastic drop in rice prices due to excessive supply during this year’s harvest, according to observers.
Commerce Minister Pichai Naripthaphan announced that the first initiative involves an 8.36 billion baht rice-pledging program, whereby the government will provide a subsidy of 1,500 baht per tonne of pledged rice. Out of this amount, 1,000 baht will be allocated to the cooperative managing the pledging, while the remaining 500 baht will go to the farmers participating in the program, as stated by the minister after the national committee meeting on Friday.
Farmers can pledge their rice for one to five months during this program, which runs until February 28 next year. During their participation, rice farmers can also apply for loans from the Bank for Agriculture and Agricultural Cooperatives (BAAC), with loan amounts ranging from 9,000 to 12,500 baht per tonne for rice pledged under the government’s initiative. For example, the loan amount for pledged Hom Mali rice has increased to 12,500 baht from last year’s 12,000 baht.
The second initiative focuses on loans for rice farmer organizations, which will aggregate rice from farmers and pledge larger quantities to the government for improved pricing. The government has allocated 656.25 million baht for this loan program, with a target to pledge 1 million tonnes of rice. Under this program, agricultural cooperatives will subsidize 1% while the government will cover 3.5% of the loan interest rate.
These loans will be available until September 30 next year, and the interest subsidy will last for up to 15 months.
The final initiative involves subsidizing 3% of the loan interest for private rice warehouse operators participating in the rice-pledging scheme. In return for this financial support, these operators are expected to manage pledged rice stocks for a period ranging from two to six months.
