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[Thai Economics Library | Archives| Currency Crisis 2007| Entrepreneurs]
April 01, 2008

Rush by Thai farmers to cash in on rice bonanza
thwarted by nature

By Jon Fernquest



As world rice prices soar, the incentive to produce more and more of the increasingly valuable commodity rice accelerates.

An article in Monday's Bangkok Post reported on the rush by farmers to produce yet another rice crop this year to cash in on higher rice prices.

Today's Post Today editorial even suggested that a cartel of the world's leading rice producers similar to OPEC be formed to control rice prices:

"In the long run, it might be wise for Thailand and other major rice producers to form a cartel - similar to the Organisation of Petroleum Exporting Countries - to raise the income and living standards of their rice farmers." (Source: Post Today, temp-link)

If high rice prices are here to stay this might be the best long-term option, but in the meantime nature limits agricultural productivity in the form of a limited water supply and weeds that are difficult to uproot, as the following article describes.

(See photo of Sirikit Dam on right, important collection point for irrigation water in northern Thailand)

Read previous Bangkok Post articles on agriculture from the archives.


Farmers rushing to plant new rice crops

But water shortages could be a problem, writes Piyaporn Wongruang in Ang Thong Monday March 31, 2008

Farmer Bai Morakot, 63, is channeling pumped water into his paddy field in tambon Inthapramoon of Pho Thong district, Ang Thong province. Rising rice prices are encouraging farmers to grow a second rice crop although the Irrigation Department has warned of a water shortage in the dry season.

Boonlert Manoon cannot allow his farmland to rest much longer after using it to grow the first off-season rice crop, which was harvested a few days ago.

The 39-year-old farmer in Pho Thong district of the central province of Ang Thong could harvest barely half a tonne of rice per rai in his nine-rai plot because his plants were competing for water with khao hang, rice with no productivity which was unintentionally left in fields years before.

Given his low productivity, Mr Boonlert has missed out on the high profits enjoyed by his neighbours due to the soaring price of rice.

Trying to catch up with his neighbours, he is quickly growing a second off-seasonal rice crop although he has realised that this would mean the risk of water shortages, which could minimise the productivity of his rice.

"I managed to get about 9,500 baht a tonne as my rice was not quite good, but this price was still far better than in previous years. I want to grow rice and get money again," said Mr Boonlert.

In neighbouring Chaiyo district, farmer Somjit Waewphetch, 75, enthusiastically killed khao hang for the fourth time in the past few months with strong herbicides, using far more of the suggested amount.

He said he had no idea whether the herbicides would be harmful to him. He just could not pass up the opportunity to make similar profits as others, he said.

"I have missed the first chance, so I have to rush," said Mr Somjit, who hopes his 30 rai of paddy fields will soon be clear of khao hang.

In Ang Thong, a lot of farmers like Mr Boonlert and Mr Somjit are in a hurry to plant rice for the second time to cash in on the rising price. However, the rush has given irrigation officials a headache, since this will create more pressure on water supplies.

For decades, water supplies have been predominantly regulated by the Royal Irrigation Department, which has shared water for several purposes, including farming.

The Central Plains region is considered to be the best equipped with irrigation systems, which have allowed farmers to grow rice outside the rainy season.

These include the Chao Phraya dam, which has helped lift the water level of the Chao Phraya river so that water can be sent further away to feed farmland. Along with a complex network of canals and sluice gates, the dam can feed up to three million rai of farmland in five major farming provinces - Chai Nat, Sing Buri, Ang Thong, Ayutthaya and Suphan Buri.

Every year the Royal Irrigation Department collects water in its reservoirs nationwide, including the Bhumibol and Sirikit dams in the North.

It will normally release water for farming, including rice planting, only once in a dry season.

According to Jaray Thongduang, director of the Hydrology and Water Management Centre for the central region, the water storage at the end of last year was not a good start, since the Sirikit dam was only just over half of its capacity then.

As of last Wednesday, the two dams had only about 6,000 million cubic metres, lower than half of their storage capacity.

The department needs to feed water to other sectors, which have to survive the dry season too, and can no longer release additional water for farming, he said.

"If the trend continues like this, I fear that competition for water will be harsh this year," said Mr Jaray.

So far, the centre has found that a second crop of off-season rice has been grown on 130,000 rai of farmland.

Rice planting in the first crop far exceeded the limits of water supply planned by the department.

Up to 700,000 rai of farmland in the first crop were found to have been planted with rice, having already taken the limited water released by the department.

Competition for water in the area has led to fierce fights and even deaths among farmers.

So far, Mr Jaray said, officials have tried to negotiate with the farmers to help share water among them.

However, he conceded that he cannot see many positive results since the second off-season rice planting this year was accelerating and widespread.

He said it is no longer possible to manage rice planting based on growing areas, as it currently is, since this does not match with reality.

(Source: Bangkok Post, general news, page 2, 31-04-08, temp-link)


Vocabulary:

cash in on Y - make a profit from situation Y

cash in on the rising price - make profits from rising prices

a bonanza - a sudden great increase in wealth, luck, and success

X thwarted by Y - Y prevents plan X from being carried out

an incentive - a reward for doing something

a cartel - a group of countries or companies formed to control prices and prevent competition (See Wikipedia on cartel)

OPEC - Organisation of Petroleum Exporting Countries (See Wikipedia)

are here to stay - are permanent, will not change or disappear

in the meantime - while waiting for something to happen

paddy - rice in the husk, either gathered or uncut and still in the field

a paddy field - a rice field

a channel (noun) - a passage that water flows through

channel (verb) - directing water through a channel

channeling pumped water into his paddy field - watering his rice field with irrigation water

irrigation - the artificial application of water to the soil to help crops grow (See Wikipedia)

off-season - not the normal time of year for growing this crop

productivity - the amount of output or production that an economy gets for a given level of inputs such as labour and capital (See The Economist glossary)

rice with no productivity - a weed

a weed - an unwanted plant that causes problems for humans (See Wikipedia)

uproot a weed - pull the weed out of the ground, remove weed

a herbicide - a weed-killing chemical (See Wikipedia)

intentionally - planned, done deliberately, done on purpose

unintentionally - not planned

miss out on - fail to participate in (something you would have liked to participate in)

catch up with - go faster and reach someone in front of you

catch up with his neighbours - hurry and start doing what neighboring farmers are doing, who are ahead of you

pass uppass up an opportunity - do not take advantage of, do not use an opportunity

could not pass up the opportunity to make similar profits -

predominantly - most noticeably

predominantly regulated by Y - Y is the most noticeable government regulator of this activity

a sluice - a passage that carries a current of water

a current of water - water moving in a certain direction

a sluice gate - the barrier or door at the end of a sluice, opened and closed to control the flow of water

a complex network of canals and sluice gates - an irrigation system

hydrology - the study of how water moves over and under the earth, the man made distribution of water through wells, dams and canals, as well as water quality (See Wikipedia)

a dam - a wall built across a river to block the water and turn it into a lake and reservoir (See Wikipedia)

a reservoir - an artifical lake used to store water, often created by a dam (See Wikipedia)

Sirikit dam - a dam in Uttaradit province that is used for irrigation (See see photo above on right, read about giant catfish that were released in Sirikit reservoir)

storage capacity - the amount that can be stored (water storage capacity of a dam, for instance)

half of its capacity - half of what it could store

needs to feed water to other sectors - there are other uses of water besides agriculture, industry and urban use, for instance

conceded that X - admit that something is true or correct, when it disproves the argument that you are making (conceding some points makes an argument more convincing)


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