As rubber prices slump, hard-up farmers in Thailand — the world’s top producer of the commodity — are appealing for a bailout, testing the junta’s resolve to end populist policies and an entrenched subsidy culture.
The global price for a 1kg sheet of natural rubber has retreated to 43 baht (US$1.3) after a three-year slide.
That decline, from highs of up to 120 baht in 2011, has chiseled away the income of the nation’s estimated 6 million rubber farmers.
Many of them reside in the country’s south, a region home to the ultra-royalists who backed a May army coup that toppled the elected government.
Now, as their profits shrivel, they want payback from an army they helped propel to power.
With dawn creeping over his plantation in Pa Ko sub-district of Phang Nga Province, Jade Charongan said tapping his 500 trees for the once-lucrative sap yields about US$130 a month.
Three years ago he earned five times that amount, as surging demand from China saw rubber reach highs of US$3.6 a kilogram.
“Now the rubber price is very, very low and life is tough,” Jade said, adding that rising living costs mean “farmers in almost every house have problems.”
The uncertainty heaps further misery on the daily 4am torch-lit trudge to bleed the trees for the milky white sap, he added.
The Thai Rubber Farmers’ Association says the kingdom produces around 4 million tonnes per year with an average annual export value of about US$8 billion — although that sum has been sheared by falling global prices.
Farmer Somjai Chomkhwan, 51, was among thousands of southerners who traveled to Bangkok to join the mass rallies that paralyzed former Thai prime minister Yingluck Shinawatra’s government, paving the way for the May 22 coup.
“When the junta came into power, we expected the rubber price would probably be increased,” he said. “But it has been months and the rubber price has kept dropping.”
Farmers’ groups are calling on the military government to guarantee the price at 80 baht a kilogram.
They also want the suspension of a plan to release 210,000 tonnes of stockpiled — but fast-degrading — rubber to the market, fearing it is set to further depress prices.
“If the government does not adjust the price, we plan to go to meet the prime minister,” Thai Rubber Farmers’ Association president Sawad Ladpala said.
The protests which presaged the coup targeted Yingluck and the political ascendancy of her brother and former Thai prime minister Thaksin — a billionaire who is reviled in the Thai south, but adored in the rice-growing north.
The demonstrators accused the Shinawatra clan of lavishing state subsidies on its rice farming electoral base at the expense of the rest of the nation.
Yingluck swept to power in 2011 on a wave of support from the north and northeast on a pledge to pay up to 50 percent of the market price for rice — a policy she said was necessary to help the rural poor.
State largesse under her tenure also extended to rubber farmers.
Following violent protests in the south last summer, she doled out US$80 per 0.16 hectares to help ease dropping prices.
From rice to rubber and sugar cane to fruit, successive Thai governments have seen the political wisdom in buttressing the agricultural economy with cash handouts.
The ruling junta initially vowed to extinguish Thailand’s subsidy culture, but even they have swiftly opened the tap amid complaints from rice and rubber farmers.
Tough-talking army general turned Thai Prime Minister Prayuth Chan-ocha has released US$1 billion for rubber farmers to help ease the pain of falling prices.
He says he wants to spur domestic demand for rubber and value-added products, while also urging farmers to diversify or change their crop to palm oil.
However, as yet he has failed to respond to the call for an 80 baht price guarantee.
In a weekly television address recently Prayuth implored rubber farmers to “please be patient.”
Rumblings from senior officials since suggest a climbdown could be imminent.
Yet the subsidy question remains awkward for a leader who has vowed tough action to restore Thailand’s economic fortunes after its once fizzing economy went flat during the political crisis.
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to