TO PREVENt the price of cassava falling during the harvest season, the Commerce Ministry will force tapioca traders to keep more stocks of the commodity and export less.
From early in the new year through to the end of April, tapioca traders will have to maintain stocks in a proportion of 1.5:1. For every 100 tonnes they export, they will need to keep 150 tonnes in stock.
Normally, the stock-to-export ratio for tapioca is 1:2.
Duangporn Rodphaya, director-general of the ministry’s Foreign Trade Department, said the measure would help balance supply and demand of cassava during the harvest season, and keep the price from falling too much.
To ensure traders obey the regulation, the department will send inspectors to warehouses twice a month.
Moreover, to absorb some of the cassava supply during the harvest season, a memorandum of understanding has been signed by the Cassava Growers Federation, the Thai Ethanol Manufacturing Association, and an association of producers of cassava-derived ethanol, to ensure at least 1,200 tonnes of cassava per day is purchased from farmers for at least Bt1.90 per kilogram.
The MoU will be effective from January to March, during which time a total of 108,000 tonnes of cassava will be absorbed to supply ethanol producers, the Commerce Ministry says.
The ministry predicts that next year a total of 31 million tonnes of cassava will be cultivated, about 17 million tonnes of which will be produced during the first quarter.
During the first 10 months of this year, Thailand exported 8.9 million tonnes of tapioca products worth US$2.38 billion (Bt85.7 billion), down by 10.4 per cent year on year|in volume and 20.29 per cent invalue.