Commerce Ministry Unveils New Rice Economy to Boost Farmer Incomes
The Commerce Ministry launched a new rice economy strategy to raise farmer incomes by improving yields and adding value, targeting 4.6 million households.
Deputy Commerce Minister Poonpong Nayyanapakorn stated that rice is a strategic agricultural commodity crucial to Thailand's economy in terms of food security, exports, and farmer income. The key goal of Thai rice development must go beyond merely raising export volumes to include boosting production efficiency, creating added value, and ensuring farmers receive appropriate returns and stable incomes amid global market competition and policy changes by trading partners. The Ministry of Commerce is therefore prioritizing short-term market oversight alongside long-term efforts to enhance Thai rice's potential.
Rice cultivation involves approximately 4.6 million farming households, nearly 60 percent of all agricultural households nationwide. Of these, about 3.1 million are in the Northeast, 1.04 million in the North, 410,000 in the Central region, and 58,000 in the South. Total rice planting area covers 73.82 million rai, divided into 61.18 million rai of wet-season rice and 12.64 million rai of dry-season rice, supporting both export and domestic demand while linking rice mill businesses, trade, and services. The packaged rice market alone is valued at roughly 66 billion baht. Thailand also holds strengths in diversity, including Hom Mali rice, glutinous rice, local varieties, and 24 geographical indication (GI) rice registrations spanning 30 provinces.
Thai rice development must proceed on both short- and long-term tracks simultaneously, safeguarding current farmer incomes while creating future opportunities. The objective is not simply to export more rice but to help farmers produce more efficiently, lower costs, secure fair prices, and increase net earnings so that over 4.6 million Thai farm households genuinely achieve better livelihoods.
Currently, Thailand's average rice yield stands at 456 kilograms per rai, compared with China at 1,146 kg/rai, Vietnam at 979 kg/rai, and India at 704 kg/rai. Part of this gap stems from rice varieties, irrigation systems, and terrain. In October 2024, Thailand's 5% white rice export price was about 21 percent higher than India's and roughly 12 percent above Vietnam and Pakistan, underscoring the importance of improving efficiency and managing production costs.
The Ministry of Agriculture and Cooperatives is implementing the Thai Rice Sandbox project on about 100 rai, using high-yield varieties KDML113 and KDML85, promoting low-carbon rice, precision agriculture, and water management. This is expected to achieve yields of 1.4–1.5 tonnes per rai under suitable conditions, with emphasis on cost-effectiveness and farmer returns.
Despite rising global competition from India's return to exports with large stockpiles, Indonesia's push for domestic rice production, and geopolitical, exchange-rate, and logistics volatility, the Department of Foreign Trade continues expanding export markets through coordination with exporters and market exploration. In the first nine months of 2024, Thailand exported 4.99 million tonnes worth approximately 94.9 billion baht, driven by higher Thai rice prices compared to the previous year. For instance, 5% white rice averaged $470 per tonne versus $335 previously, while Hom Mali rice exceeded $1,035 per tonne. Meanwhile, farm-gate prices for 15% moisture paddy rose from 6,600 to 9,500 baht per tonne.
