Commerce Ministry to propose direct cassava subsidy instead of pledging
THE COMMERCE MINISTRY plans to propose to the Cabinet a direct subsidy for cassava farmers to buy equipment and other material, instead of pledging their output as in the past, in the upcoming harvest season to minimise spending and increase efficiency of
Deputy Commerce Minister Yanyong Phuangrach said the ministry would this week ask the Cabinet to approve Bt14 billion for the subsidy.
Under this method, the minis-try would provide a subsidy for |agricultural equipment directly |to 497,000 cassava farmers on |the basis of about 50 satang per kilogram of output.
Yanyong said the government would have to decide whether to adopt this system rather than a price-pledging project for cassava farmers.
Cassava can be stored longer than rice. Once cassava farmers received a subsidy to help with |their equipment costs, they could decide whether to cultivate more |of the commodity or keep what |they had and wait for the price to go up.
If it uses the pledging method for cassava, the government will have to spend more up to Bt29 |billion for the project. It would be able to help fewer farmers, only 370,000 of them, as pledging volume would be limited to 10 million tonnes.
Normally, the government allocates a budget for a cassava pledging project each year. The pledged price would be Bt2.50-Bt3 a kilo.
However, Yanyong said his ministry preferred a direct subsidy as it would get rid off middlemen and ensure that farmers see a fair gain from the government’s assistance.
Meanwhile, the ministry is inspecting rice-pledging stations after becoming concerned about a high volume of pledging during the past two months. Yanyong said there was concern that some unscrupulous millers could be usurping farmers’ rights to pledge their own rice.
From October to December 4, about 5.91 million tonnes of paddy has been pledged into the government’s warehouses.
