Supant urges shift to higher-value crops

 “Apart from helping small and medium-sized enterprises who have been hit since the major flooding in 2011, political turmoil in 2014 and now the slowdown in export and domestic consumption, the government must also concentrate on improving the agriculture sector, which is currently being hit with falling crop prices and ongoing drought. Both of these sectors are unable to flourish right now,” he told an economic seminar arranged by the National Legislative Assembly last week.

Helping SMEs and farmers will increase domestic consumption and increase government income via the collection of value added tax, he said. The way to help farmers is not through populist policies that distort prices and prompt the migration of workers or just giving cash handouts, but through tangible zoning and help them increase productivity and lower production costs.

“We keep on talking about zoning but is there an actual government office that is taking care of agricultural zoning? The answer is no, there is none and if there is one, I do not see them,” he said.

“Actual zoning means deciding with technology and knowledge of outside and local expertise on the best place to grow what crop and provide incentives to grow such crop there while other crops that are not suitable get subsidies from the government,” he added.

Supant said that in the long-term the government should concentrate on transforming the agriculture sector from a supplier of raw materials such as rice, rubber and sugar to value-added and processed products since the country already has those supplies. But the problem is the lack of technology and the absence of research and development in this field.

“Cost of production is the number one priority for investment and since we have abundant supplies from the agriculture sector, we should use it as our investment blueprint for the future. Processed and healthy foods along with cosmetics are in demand from the global market and we could become the main supplier of the world if we concentrate and invest more in this field,” he said.

Vorapol Socatiyanurak, NLA member and secretary-general of the Securities and Exchange Commission, said Thailand is currently subsidising rice for the whole world since we are selling rice at a cheap price but we are importing large amounts of oil to produce the rice.

“We have to move towards higher value crops such as cassava since we can also use it to create ethanol fuel and lower our imports of crude oil in the process,” he said.”

“I am not saying that we should stop producing rice but we should add more and higher value crops in the production line and the government has to support the cost of this change since it is an investment for the future and farmers will also gain from the increase of profit,” he added.