InfoQuest (November 12, 2019) -- The mobile cabinet meeting approved the 2019/2020 cassava price guarantee program. The program, funded with 9.671 billion baht, will provide a price guarantee for fresh cassava with 25 percent starch content in the country's cassava growing areas at 2.50 baht per kilogram, with a maximum subsidy of 100 tons per household, according to Ms. Ratchada Thanadirek, deputy government spokeswoman.
"Cassava is the fourth agricultural product included in the price guarantee program after rice, rubber, and palm," said Ms. Ratchada.
Those who are eligible for the differential subsidy are farmers who have registered as cassava growers and have reported the harvest time to the Department of Agriculture Extension. Each household are able to receive the subsidy for the difference between the guaranteed price and the reference price once, and the Bank for Agriculture and Agricultural Cooperatives (BAAC) will transfer the subsidy directly to farmers' accounts. An estimated 540,000 people are expected to register for the subsidy.
The registration began on October 1, and farmers can enjoy the subsidy during the harvest time declared at the time of registration. The government will pay the first batch of price differential subsidy on December 1, 2019, and continue to pay on the first day of each month thereafter for 12 months. Farmers who harvest cassava before December 1, 2019 can receive the subsidy on December 1. The implementation period of the program lasts from October 1, 2019 to December 31, 2020.
The Ministry of Commerce has also issued collateral measures to peg cassava prices. First, it urges to maintain the fairness of cassava trading, require quality inspection of cassava products and deduct the weight of impurities. Screening machines must be installed in cassava sheet and cassava flour factories to screen out impurities before purchase, and the purchase price should be made public.
Second, it demands the Department of Foreign Trade (DFT) strengthen supervision and management in the procedures of import and export, check whether the quality is in line with the standards and strictly punish violators in accordance with the laws.
Third, the program to improve cassava planting efficiency will be implemented. The Bank for BAAC will arrange credit to finance farmers in the production and utilization of technologies to reduce costs. The credit is targeted at 5,000 farmers, each with no more than 230,000 baht. The total credit is capped at 1.15 billion baht and interest rate stands at 3 percent.
Fourth, the program aiming at cassava purchasing and value-added increase of cassava will be advanced. The Bank for BAAC will provide credit to farmers' agencies operating cassava business or farmers' agencies specializing in animal husbandry for purchasing fresh cassava and cassava sheets for sale or processing, so as to digest cassava at a time when the market is oversupplied. The total amount of credit for this program reaches 1.5 billion baht, with an interest rate of 4 percent.
Fifth, it introduced the measures to promote the consumption of cassava at home, including the processing of cassava into bio-plastic products and its adoption in the food industry.
Sixth, it will increase the distribution channels of cassava products. In particular, cassava alcohol and cassava residue currently faces a limited market. Ethanol production by consuming cassava can only absorb 2.5 million tons of fresh cassava. Hence, in order to promote cassava and agricultural products in alcohol production, the restrictions in the Liquor Act, B.E. 1950 should be amended to enable ethanol factories using crops as raw materials to sell the ethanol products to other industries except fuel.
The cabinet meeting also approved subsidies to areas that do not have ownership documents within the scope of the cassava mosaic disease (CMD) prevention and control program, without any restriction on the harvest time. Prior to this decision, only farmers with legal ownership documents were subsidized, making it impossible for the prevention and control of CMD to cover all.
Ms. Ratchada added that Prime Minister Prayut Chan-o-cha stressed at the meeting that subsidies to farmers without ownership documents are not to encourage farmers to encroach on public land. It has to be done according to the laws.
Source: InfoQuest, by Tanawat Suayaem/ Rachada, translated by Xinhua Silk Road.
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