Next: Unpaid Thai rice farmers may protest

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Out of money: Thailand's Bank for Agriculture and Agricultural Cooperative (Photo: Arno Maierbrugger)
Out of money: Thailand’s Bank for Agriculture and Agricultural Cooperatives (Photo: Arno Maierbrugger)

The populist rice pledging scheme in Thailand, which was originally meant to keep millions of rice farmers loyal to the government by buying rice from them high above market rates, has started to heavily backfire money has dried up.

The Bank for Agriculture and Agricultural Cooperatives (BAAC), in charge for the  payouts, has run out of cash in November and since managed only partly to refinance itself. It turned to the bond market to raise funds to pay farmers, but managed to get only 37 billion baht ($1.16 billion) on a 75 billion baht($2.34 billion) offering.

Furthermore, the Thai Finance Ministry on December 12 declined to come up with a credit guarantee for the BAAC after the parliament has been dissolved due to ongoing political protests and the current caretaker government is not in the role to issue such a guarantee.

Angry farmers, who have just received vouchers since November, are now threatening to block roads in 26 provinces, adding to the problems of Prime Minister Yingluck Shinawatra, who called snap elections for February 2, 2014.

The government has spent up to 680 billion baht ($21.25 billion) in four harvest seasons over the last two years, but has sold only 135 billion baht ($4.22 billion) worth of rice and sits on estimated stockpiles of 16 tonnes.

The BAAC will now try to place another rice bond in January will paying the farmers “gradually” from the funds available. They, however, pressed the government to sell more rice on the market to bring in liquidity and said they were “running out of patience.”

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Reading Time: 1 minute

Out of money: Thailand’s Bank for Agriculture and Agricultural Cooperatives (Photo: Arno Maierbrugger)

The populist rice pledging scheme in Thailand, which was originally meant to keep millions of rice farmers loyal to the government by buying rice from them high above market rates, has started to heavily backfire money has dried up.

Reading Time: 1 minute

Out of money: Thailand's Bank for Agriculture and Agricultural Cooperative (Photo: Arno Maierbrugger)
Out of money: Thailand’s Bank for Agriculture and Agricultural Cooperatives (Photo: Arno Maierbrugger)

The populist rice pledging scheme in Thailand, which was originally meant to keep millions of rice farmers loyal to the government by buying rice from them high above market rates, has started to heavily backfire money has dried up.

The Bank for Agriculture and Agricultural Cooperatives (BAAC), in charge for the  payouts, has run out of cash in November and since managed only partly to refinance itself. It turned to the bond market to raise funds to pay farmers, but managed to get only 37 billion baht ($1.16 billion) on a 75 billion baht($2.34 billion) offering.

Furthermore, the Thai Finance Ministry on December 12 declined to come up with a credit guarantee for the BAAC after the parliament has been dissolved due to ongoing political protests and the current caretaker government is not in the role to issue such a guarantee.

Angry farmers, who have just received vouchers since November, are now threatening to block roads in 26 provinces, adding to the problems of Prime Minister Yingluck Shinawatra, who called snap elections for February 2, 2014.

The government has spent up to 680 billion baht ($21.25 billion) in four harvest seasons over the last two years, but has sold only 135 billion baht ($4.22 billion) worth of rice and sits on estimated stockpiles of 16 tonnes.

The BAAC will now try to place another rice bond in January will paying the farmers “gradually” from the funds available. They, however, pressed the government to sell more rice on the market to bring in liquidity and said they were “running out of patience.”

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