The main purpose of the rice pledging scheme in prime minister Yingluck Shinawatra’s government is to solve the problem of poverty of the farmers, so the government solve this problem by raising the prices which is higher than the rate that will make the market balance. According to the Wall Street Journal, “Prime Minister Yingluck Shinawatra launched a gambit to shift more cash into the rural economy by buying up rice from farmers at about 18,000 baht, or $550, a ton, around 50% higher than the market rate.” The target of the government from raising the rice price is to drive up global rice prices. The plan of Thai government estimate from the situation in 2008 that India temporarily restricted rice export because they worried about rising rice prices in their country. After the rice export cross-border came to a sudden stop, the global prices increased rapidly. According to the World Bank, the global rice prices is increased from $300 a ton to $900. This caused India resumed exports after a long absence. From this wrong prediction made Thai’s rice could not export as much as the government planned because India has cheaper costs than Thailand, so they can export and make profit more than Thailand.
In addition to high rice prices in the country, Thai rice market export also lose market to export cross-border,