Dairy Farmers Celebrate as Cabinet Approves 600 Million Baht Loan for Raw Milk Purchases
Thailand's Cabinet approved a 600 million baht interest-free loan for the Thai Dairy Promotion Organization to purchase raw milk from 5,110 farmers across five regions, addressing liquidity challenges caused by reduced consumer demand and c
Dairy farmers are celebrating after the Cabinet approved a proposal allowing the Thai Dairy Promotion Organization (อ.ส.ค.) to borrow 600 million baht from the Agricultural Farmer Fund to purchase raw milk under Phase 2 of the agricultural milk procurement project. Government Spokesperson Ratchada Thanadirek announced on April 28, 2569, that the Cabinet has endorsed the Ministry of Agriculture and Cooperatives' proposal to provide this interest-free loan with a seven-year repayment schedule from 2568–2575.
The project aims to strengthen the organization's financial liquidity and serve as working capital for collecting and purchasing raw milk from dairy farmers in five designated regions: Central (Saraburi), Southern (Prachuap Khiri Khan), Northeastern (Khon Kaen), Upper Northern (Chiang Mai), and Lower Northern (Sukhothai). The initiative covers 44 cooperatives with a total of 5,110 member farmers.
Phase 2 targets purchasing 26.375 million kilograms of raw milk per production cycle, allowing farmers to sell three production cycles annually for a total of 79.125 million kilograms over the seven-year project period (2569–2575). This continues from Phase 1 of the same initiative.
The organization has faced severe liquidity challenges due to prolonged economic slowdown that reduced consumer purchasing power, resulting in milk product sales falling short of targets. The impact of Thailand's free trade agreements with Australia and New Zealand, which reduced dairy product import tariffs to zero percent, has forced some manufacturers to substitute milk powder for domestic raw milk. This additional milk purchase program is designed to support dairy farmers who lack alternative sales channels.