The company says the system will eventually increase yields by 30 per cent and guarantee food safety. The final result will be increased production of a more valuable product: organic sugar.

Narong Chinabut, director of agro-industry development in the executive chairman's office, says Wangkanai is the first Thai refiner to go organic.

To achieve the plan, the group will spend a total of Bt72 million through 2010.

Narong says the system will help farmers reduce production costs and the use of harmful chemicals. Farmers will eventually enjoy higher incomes, he said.

They will be encouraged to use more bio-fertilisers instead of chemicals. They will also be shown how to use one kind of pest to kill another and be helped to improve and maintain soil quality.

Wangkanai has 20,000 contracts with sugar-cane farms with a total size of 600,000 rai. Raw materials are supplied directly to its sugar mills in Suphan Buri, Lop Buri and Nakhon Ratchasima. A fourth is to open soon in Maha Sarakham.

The group's total sugar production reaches between 300,000 and 400,000 tonnes per year. The organic farm system is expected to increase production to 800,000 tonnes.

In the beginning, 800 leaders among the contracted farmers will be trained in organic practices. The practices will then be introduced in stages to the other contracting farmers by 2010.

The company says that production costs in organic farms is Bt700 per rai compared to Bt1,000 in those that use chemicals.

It expects production to rise from 9.3 to 13 tonnes per rai by the end of this year.

Narong says Thai cane growers and sugar refiners must create higher value for their product in a tough international environment.

Thailand is the world's second largest sugar exporting country after Australia but its total production is only a fraction of that country's output.

Thailand's other major export competitors include Brazil, Argentina and China, all of which have higher production than the Kingdom.

Thailand's total production of sugar-cane is expected to reach 46.7 million tonnes this year or its average of 9.3 tonnes per rai, as compared with the world's highest production of 18-20 tonnes per rai.

"The change of the agricultural system will lead the company to sell pure organic sugar within five years. The high demand of the market for organic food has enhanced the strategy," said Narong.

The retail price of organic sugar per is Bt2-3 per kilogram higher than normal refined sugar.

Petchanet Pratruangkrai

The Nation