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Thai Agriculture at the Crossroads

By Nareerat Wiriyapong, The Nation, Thailand

Agriculture, Thailand’s most important economic sector, faces many challenges as it enters the 21st century, including high rural debt, technological change and increasing competition from major trade rivals.
 
Thailand is the world’s No1 rice, tapioca, and canned pineapple exporter, and in the top three for sugar, rubber and prawns. It is Asia’s biggest supplier of chicken, cut flowers, and a leader in exports of fresh fruits.
 
But this success has its dark side. Thailand’s farm sector is suffering from years of export-oriented production, experts say. Millions of farmers caught up in the export-agriculture machine remain deeply impoverished as they strive to increase yields on small plots of land by borrowing money to buy chemical fertilisers and pesticides. Over time, the chemicals resulted in extensive pollution and land degradation.
 
New movements in response to these deep problems are attempting to break farmers free from the current export-agriculture trap, but these raise new problems and challenges for Thailand’s 28 million farmers.
 
One response promoted by Thai King Bhumibol Adulyadej as the " New Theory "  is to switch to the old way of growing several kinds of crops and using less chemicals. “Self-sufficiency” is a new buzzword.
 
" There is a big shift now in Thailand ", said Phrek Gypmantasiri, Assistant Director and Chairman of the Agricultural Systems Programme at Chiang Mai University’s multiple cropping center, and a supporter of the New Theory.
 
The alternative farming strategy was first suggested by the King after the country’s economic crisis started in 1997. Essentially, an ecologically sound concept of sustainable or alternative agriculture, the farmer’s main goal is to grow enough food to feed their families.
 
The method relies on traditional and more environment-friendly ways of cultivating the land. The King said self-sufficient farmers should each grow several kinds of crops, raise different types of livestock and have a fish pond. If they have any crops left over, farmers sell them for cash.
 
An increasingly popular variation on the new approach is for farmers to grow organic foods, using little or no chemical pesticides or fertiliser. That lessens their dependence on the banks. And it makes them more reliant on each other. The theory encourages farming communities to improve marketing skills through closer cooperation within the community and the private sector, Phrek said.
 
The shift is coming about because of a widespread predicament among Thai farmers. Boonsong Shinawong, a 53-year-old onion grower in Chiang Mai’s San Patong district, is typical of farmers suffering from intensive chemical use and export-market dependency.
 
He needs pesticides to grow intensive crops, he says. He can’t stop using them. " At the same time, I have to use more fertiliser continuously to maintain production levels since my 2.5 rai of onion field has been degraded" , he said.
 
The rising cost of expensive chemical fertilisers and pesticide use has pushed him 100,000 baht in debt.
 
He’s not alone. On a national scale, 25 million farmers, or 88 percent, are in debt. As of March 31 this year, outstanding loans to the Bank of Agriculture and Agricultural Cooperatives (BAAC), which provides most of the loans to farmers, stood at 288.45 billion baht. About 15% of BAAC’s borrowers are in default: they cannot repay their loans of roughly 43 million baht, or US$ 1 billion.
 
Suphan Kamphen, 46, a woman farmer in Chiang Mai province, is an example of someone who has escaped Boonsong’s fate by adopting the new approach. After only four years of shifting from chemical-intensive monocrop farming to organic food, Suphan has already erased her debt.
 Her annual income has grown to 70,000 baht, compared to 10,000 baht when she grew just one cash crop. She sells only to local markets, rather than foreign ones.

"Now" , she said, "organic food can be sold easier than in the past as the people have paid more attention to healthier food."

 While the King’s New Theory is taking root, still only about 1 percent of Thailand’s farmers have adopted it. Meanwhile, the vast majority, like Boonsong, remains caught up in export-oriented farming. Debt continues to rise.
 
Another solution to Thai farm problems, some say, lies in the latest crop production technology, called genetically modified (GM) crops. Initiated by U.S. companies, GM crops could help farmers improve yields while requiring them to use less pesticide.
 
GM crops are developed from seeds whose genes have been altered with the genetic characteristics of other species. That can allow, for example, the plants to become resistant to certain insects and herbicides, according to David Brown, agricultural editor of The Daily Telegraph in London.
 
In theory, the GM crops would be cheaper since they require less care. Farmers might not need to invest so much in fertilisers and pesticides, and might get higher yields as well. The many possibilities of GM crops could allow Thai farmers to compete in the global market without being under the constant pressure of debt and poverty.
 
However, GM crops have become an international controversy. In many countries, consumers are still reluctant to buy GM food since nobody knows yet about its long-term effects, Brown said. In Thailand such a controversy over GM crops led the government to stop all experiments on the GM "golden rice," a species enriched with vitamin A.
 
But Thailand, like other countries, is unable to ignore GM crops. That’s mainly because the US, the world’s major food supplier, has spent huge sums to develop and introduce GM products.
 
China also has adopted GM-crop technology. A number of unregulated GM crops are being grown in China in addition to officially acknowledged experimental ones, giving the country a powerful competitive advantage, Brown said. This places more pressure on countries like Thailand to embrace this new technology.
 
Vichai Sriprasert, president of Riceland International in Bangkok – one of the country’s top 10 rice exporter companies – said Thailand should proceed with experiments on golden rice and continue to learn what GM crop technology can do. GM crops could help improve Thai rice yields amid concerns that Thailand is becoming less competitive, he said.
 
GM technology might help in response to another significant challenge to Thailand’s proud leadership in global rice exports. Vietnam, Thailand’s major rival in the rice trade, produces twice as much rice per rai as Thailand. But its quality of rice is inferior, said Vichien Petpisit, director of the botanical and weed science division of the Department of Agriculture. The two countries have different markets.
 
Nevertheless, Thailand is feeling the pressure of Vietnamese sales on its traditional markets, as Vietnam improves quality.
 
In response, Thailand is now shifting its focus to exporting high quality rice, according Vichien. The U.S., also a major exporter in the world following Thailand, is the major competitor in this market, he said.
 
The U.S. is an extremely tough, efficient, and wealthy competitor. Because GM foods are increasingly found on American farms, Thailand could be forced to introduce the controversial GM technology to its farmers. It is not clear whether it would help Thai farmers to get out of the cycle of impoverishment that has resulted in the past from trying to raise efficiency to fight in the export of farm markets.
 
None of the solutions to Thailand’s problems are easy. David Brown questioned the benefits of organic farming and self-sufficiency on the overall economic situation of Thailand. The country still requires export income to revitalize its economy while the environment-friendly approach discourages farmers from producing food for export since they don’t want to fall in debt again.
 
In Thailand, some see a two-tiered system of farmers developing. One would continue to produce crops for export, while a growing number would adopt the self-sufficient approach. For many, it is hard to escape the logic of happy Suphan Kamphen’s successful switch from export farming to small, organic, local-market oriented crops.

Copyright 2009 IMMF.