Planning for long-term sustainability crucial

| 30/12/2009 | Reply

By Petchanet Pratruangkrai

Climate change, natural disasters, plant epidemics and liberalisation under the Asean Free Trade Agreement could all affect Thailand’s farm output and trading competency.

The Office of Agricultural Economics predicts prices of major crops will increase considerably next year, by 10-20 per cent.

effects of climate change, not to mention possible natural disasters,
could reduce production and increase demand, thus driving up crop
prices. Rising concerns about food security and increased demand for
fuel crops in world markets to compensate for oil-price hikes will also
hike prices.

Thailand has long prided itself on being an
agricultural supplier to the world, but local farmers have always been
counted among the poorest in the Kingdom, the result of a lack of a
long-term plan for agricultural development.

have always looked to the farm sector for support, since there are more
workers in it than in any other. Last year, more than 39 per cent of
labourers worked in the farm sector, followed by 31.3 per cent in
services, 15.3 per cent in retail and 14.5 per cent in industrial

Thai governments
have paid a great deal of attention to the farm sector, mainly by
setting up pledging schemes to guarantee farmers’ incomes, because the
sector is a populist base. But this is a short-term measure. The few
attempts there have been to create sustainable measures for sector
development have not been efficient enough to boost the competitiveness
of local crops.

Thailand is the world’s 13th-largest food
supplier, with its exports accounting for 2.4 per cent of the value of
the world’s food trade. However, Thailand’s export growth in farm and
other food products has shown only slight growth, a smaller percentage
than its export rivals have enjoyed.

The “Global Trade
Atlas” in July said exports of Thai foods increased only 16.1 per cent
last year, while other countries enjoyed larger growth. Food exports
grew 21.8 per cent in Vietnam, 22.4 per cent in Malaysia, 23.1 per cent
in India, 20.6 per cent in Argentina, 22 per cent in Brazil and 29.1
per cent in Indonesia.

Exports grew in those countries
largely because of clear government policies of promoting the food
industry. For instance, Malaysia heavily promotes halal food exports,
while Indonesia focuses on fishery products.

Thailand has a variety of crops and a strong food-industry chain, as
well as sufficient food for domestic consumption. However, individual
farmers have never developed their full potential, as most of the money
in the farm sector falls into traders’ hands rather than farmers’.

year will be another great year for Thai farm exports, but traders may
reap the full benefit rather than farmers,” said Internal Trade
Department director-general Chutima Bunyapraphasara.

resources are there, but farmers need a better education and a
knowledge of systematic management to benefit more from farming and
trading, she said.

The government has been slow to provide
farmers with basic infrastructure like irrigation to help them sustain
their land productively in the long run. Farmers have also not been
able to use available resources fully to provide the best yields.

example, Laddawan Kunnoot, director of the Rice Department’s Bureau of
Rice Products Development, pointed out the average yield per rai for
Thai rice was only 465 kilograms, while for competitors like Vietnam,
India and China it was 600-700kg. This is because only 30 per cent of
Thai rice is grown in irrigated areas.

Vietnam’s higher production per yield results from 82 per cent of its rice being irrigated.

crops, such as rice, cassava and maize, are often not compatible with
the local environment. Traders have called for the government to
introduce zoning for crops, in order to ensure appropriate farming
methods that fit local environmental conditions.

as global demand shifts towards higher sanitary standards and
chemical-free products, the government should clearly promote farming
that meets this demand.

Major crops

Thai crop prices are expected to be influenced by global demand next year.


The price of white paddy rice could rise on higher demand and lower supply.

US Agriculture Department said global output should decrease from
445.67 million tonnes this year to 433.65 million tonnes, while demand
would increase from 435.33 million tonnes to 438.46 million tonnes.
Accumulated world stockpiles will drop from 90.71 million tonnes to
85.9 million tonnes.

In Thailand, the price peaked at
Bt10,914 a tonne in 2008 before sliding to Bt9,693 this year.
Thailand’s main-crop output next year is forecast to decrease by 0.51
per cent to 31.48 million tonnes. The plantation area will fall by 0.68
per cent to 69.34 million rai due to some farmers having shifted to
other crops, notably rubber, sugar cane and palm.


Thailand’s cassava output is
expected to drop by 14.13 per cent from 27 million tonnes to 25.03
million tonnes next year, due mainly to the spread of insect

Prices could be propped up on demand for cassava for biofuel production. Traders said the price could exceed Bt2 a kilogram.


The maize price is expected to increase slightly or remain unchanged next year. It is currently Bt5.78 per kilogram.

output is expected to increase by 0.16 per cent to 792.55 million
tonnes, while demand should rise 5.09 per cent to 84.79 million tonnes,
mainly for livestock feed and biofuel production. Thai output is
forecast to grow by 4.69 per cent to 4.44 million tonnes.

Sugar cane

The price of sugar cane
will increase considerably next year, due to a continued global
shortage. Thai Sugar Millers Corp expects the price of sugar will peak
at Bt1,150 this year.

Higher prices will increase
Thailand’s plantation area from 6 million rai to 6.3 million rai next
year. Sugar output will increase from 71.1 million tonnes to 76 million

Oil palm

The price of oil palm is
expected to increase to above Bt3.60 a kilogram next year, from an
average of Bt3.59 this year. Thai palm production is forecast to grow
by 21.84 per cent to 10.49 million tonnes next year, due to higher
demand for biofuel crops.

Category: Agriculture, Asia

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