Late rice payments worry farmers

Economy October 08, 2013 00:00

By The Nation

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About 500 farmers have faced a delay of more than a month in payments for their second crop under the rice-pledging scheme this year, raising concerns over whether the government has sufficient financial liquidity to support the project.

The Internal Trade Department said the government would soon investigate the delayed payments. 
Wichian Phuanglamchiak from the Thai Agriculturist Association said farmers in three districts of Suphan Buri – Muang, Bang Plama and Songpeenong – have not yet been paid by the Bank for Agriculture and Agricultural Cooperatives (BAAC) more than a month after pledging rice from a second crop this year.
He called on the government to urgently solve the problem as farmers are looking forward to their returns from their investments soon. He claimed that representatives of farmers had already asked for an explanation from the rice millers, to whom they have pledged rice, but officials had not given them an answer.
He added that farmers were worried about the delayed payments, which also raised concerns over whether the government had adequate liquidity to pay farmers for the current harvest season (2013/2014 harvest season).
The association will soon submit a letter of concern on the matter to the Suphan Buri governor and involved government agencies. 
Deputy Commerce Minister Yanyong Phuangrach said farmers normally get their payments within three days of entering the pledging scheme. After the rice is pledged, officials verify the farmers’ certification and get back to them within three days.
 The ministry reported that only 500 tonnes of rice have entered the government’s rice pledging for 2013/2014 after the scheme started on October 1.
Limited payment 
The current pledging scheme has limited payment to a maximum of Bt350,000 per household. So far, 580 rice millers nationwide have participated in the rice-pledging project.
Somchart Soithong, director-general of the Internal Trade Department, said the government would soon check on the delayed-payment case. He admitted that some farmers had faced delayed payments as officials needed to prove their farmers’ authority under the certification. 
The problem will be presented to the National Rice Policy Committee, which is scheduled to meet tomorrow, he added.
 Meanwhile, the Commerce Ministry expects the price of domestic maize should increase continuously late this year, following the government’s price intervention scheme to help farmers during the harvest season, as well as support for exports.
Yanyong said the price of maize is expected to increase to more than Bt9 a kilogram late this year as more exports are listed.
 “About 500,000 to one million tonnes of maize should be exported this year. The government has tried to help subsidise the maize price for farmers, as well as reduce the surplus during the current harvest season,” said Yanyong.
The Internal Trade Department targets purchasing 1.8 million tonnes of maize under its price-intervention project, which will have a budget of about Bt4.3 billion.
So far, 27,400 tonnes of maize have already been purchased. Yanyong said the ministry will try to encourage more maize exports to reduce the domestic surplus and drive up the maize price.
 The government has set a guaranteed price for maize at Bt7 a kilo for 30 per cent moisture content. But the market price stands at Bt5.50 a kilo. 
Narongsak Putthaporn-mongkol, president of NCA Enterprises Company, one of Thailand’s four leading maize exporters, said maize prices would increase under the government’s subsidisation for millers, so they would have more liquidity to purchase maize at a higher price from farmers.
He said the drop in the price of maize currently is due to a high supply of maize in the world market and high moisture content, while other countries have seriously cut their prices to ensure competitiveness.