The political implications of Thailand's rice issue

Panu Wongcha-um, Channel NewsAsia 10 Nov 16;

CHACHOENGSAO, Thailand: The issue of rice is once again turning into a political hot potato in Thailand.

With the price of jasmine rice hitting an almost 10-year low in some parts of the country, the military government has introduced a series of subsidy schemes worth more than US$1 billion to help farmers.

Those who pledge to store their rice for several months will get paid in interest-free loans while they wait to sell their stock at a better market rate.

Critics have said there is little difference between this programme and the failed rice purchase scheme by the previous government led by former Prime Minister Yingluck Shinawatra. Ms Yingluck, who was ousted in the 2014 military coup, faces up to 10 years in prison and a US$1 billion fine for her administration's rice policy.

However, the current government denies and has said its programmes are just a short-term solution. For the long term, it is urging farmers to diversify their crops or stop farming all together.

"We have to look at the demand to see how much rice we want for domestic consumption and for export,” said Commerce Ministry Permanent Secretary Wiboonlak Ruamrak. “Then we plan our production.

“This means some farming will have to stop or the pace of production must be slower. We have to find these farmers alternative professions or we have to give them incentives to reduce farmland so we can control the supply."

Farrmers are asking for urgent assistance. In Central Thailand’s Chachoengsao province - the home of the country’s famous jasmine rice – good monsoon rains have contributed to an oversupply of the rice, causing prices to plunge.

The sharp drop of prices for premium grade Hom Mali - or Jasmine unmilled rice - in many parts of the country prompted many farmers to call on the government to step in ahead of this year’s harvesting season.

Jasmine rice can only be grown once a year and it makes up about a quarter of all rice produced in the country.

Many disagree with the government's advice to diversify. “It is not worth it for us to raise chickens or ducks, for instance, because we need to build more farmhouses for that,” said Vimol Riamsri, the village chief and a rice farmer. “The government tells us to stop growing rice and to grow potatoes, corn, or raise chickens – I don’t think it is possible. Our farmland is very different."

One analyst told Channel NewsAsia new strategies are needed to help the struggling farmers. “In the past, governments have been helping by trying to address the cost of rice production through loans, but they did very little to improve the performance of the market, like better storage silos and better market mechanisms within communities," said Somporn Isvilanonda, a senior fellow at the Knowledge Network Institute of Thailand.

The rice-growing areas in the north and northeast are the political heartland of deposed Prime Minister Yingluck and her family. With a general election scheduled for 2017, the military government knows there are deeper implications to keeping farmers happy than simply protecting Thailand’s rice bowl.

- CNA/ek