Thailand should cut rice production in the 2016-17 crop year to only 25 million tonnes of paddy and encourage farmers to grow other lucrative crops in the dry season, say rice production planners
Commerce Ministry permanent secretary Chutima Bunyapraphasara said a meeting yesterday saw it as imperative that Thailand produce only 25 million tonnes based on domestic and global demand
That amount of paddy will translate to about 16.5 million tonnes of milled rice.
Normally, Thailand produces about 31-32 million tonnes of paddy or about 20.5-21.1 million tonnes of milled rice. Half of production is slated for domestic consumption and the balance for exports.
"From now on, Thailand's rice production should comply with domestic and global demand each year," Ms Chutima said after the joint meeting involving the public and private sectors.
"Once we have agreed to produce 25 million tonnes of paddy this year, related agencies including the Agriculture Ministry and Interior Ministry would have to work with rice exporters and farmers' associations on how to encourage farmers to manage their production as agreed."
A comprehensive rice production plan should be finished in one month before being submitted to the National Rice Policy Committee.
Thailand has about 13 million tonnes of rice in state stocks, sharply down from 18.7 million accumulated from rice schemes by previous governments.
The Commerce Ministry reported in late 2015 that since the May 2014 coup, 8.27 million tonnes have been sold from 18.7 million left over from various rice schemes, fetching 103 billion baht.
The ministry has set a target of 9 million tonnes of rice shipments this year, worth $4.78 billion. Last year, Thailand was projected to ship 10 million tonnes worth $5.1 billion.
The United Nations Food and Agriculture Organization said in its December Rice Market Monitor report that world production was expected to fall by 4 million tonnes, or 0.5%, to 740 million tonnes in 2015. That figure is below the "already disappointing" 2014.
In a separate development, the government has pledged to push ahead with relief measures for drought-affected farmers this year.
Krisada Chinavicharana, director-general of the Fiscal Policy Office, said the Finance Ministry was introducing soft loans and a debt moratorium for farmers.
"The drought has already happened in some areas and the condition is expected to exacerbate in the coming months," said Mr Krisada.
He also urged farmers to take out crop insurance. Only 1.5 million rai out of more than 30 million rai of rice plantations are covered by insurance.
Chatchai Payuhanaveechai, president of the Government Savings Bank, said it would soon hold discussion with other state banks about new measures to help small businesses and farmers.