Mapping the Agricultural Sector of Thailand: Holdings, Activities & Trends - Dr. Imke Pente Daniel Müller - OAV
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Mapping the Agricultural Sector of
Thailand:
Holdings, Activities & Trends
Dr. Imke Pente
Daniel Müller
Overview 1. General Data and Map of Regions 2. Holdings: Number, Size, Use of Machinery & Agricultural Activity 3. Land Use: Rice, Field Crops & Rubber 4. Livestock: Milk & Meat 5. Renewable Energy: Biomass & Biogas 6. Summary & Political Outlook Annotation: If not explicitly noted, the data refer to the year 2013.
General Data • Share of GDP generated in agriculture: 12% • Employment in agriculture: 40% (2012) • Rural population: 52% • Area for agricultural use: 22 million ha (42,8% of total land area) • 70% of agricultural land used for crop production • 50% of area used for crop production occupied by rice; sugarcane, maize, cassava and rubber present further important crops in terms of production quantity and value • Average size of holding: 3.15 ha [19.7 rai]
Regions of Thailand
North
Northeast
Central
South
Source: thailanguagehut.comNumber, Size, Use of Machinery & Agricultural Activity HOLDINGS
Number and Area of
Holdings
Region Number of Area of holdings Average area of
holdings (million) (million ha) holding (ha)
Number % Number %
Whole Kingdom 5.9 100 18.64 100 3.15
Central 0.9 14.3 3.12 16.8 3.68
North 1.3 22.0 4.34 23.3 3.34
Northeast 2.7 46.4 8.75 46.9 3.18
South 1.0 17.3 2.43 13.0 2.37
Source: National Statistical Office, 2014, p. xv
• The largest number of holdings are located in the Northeastern region.
They also cover the majority of farmed land.
• The farms in Central Thailand feature the largest average area of holding.
• Yet, even the largest average area of holding is relatively small.Number and Area of
Holdings over Time
10,0 19,0 18,6 20,0
18,0
9,0 18,0
Number of holdings (million)
Area of holdings (million ha)
8,0 16,0
7,0 14,0
5,6 5,8 5,9
6,0 12,0
5,0 10,0
4,0 8,0
3,0 6,0
2,0 4,0
3,4 3,1 3,2
1,0 2,0
0,0 0,0
1993 2003 2013
Number of Holdings (million) Area of Holdings (million ha) Average Area of Holding (ha)
Source: National Statistical Office, 2014, p. xv
• The number of holdings, the area of cultivated land and average
area of holding have remained relatively constant over the past
twenty years. There is hence no trend towards large-scale farms in
terms of area.Zooming in: Size of
Area of Holding
100% 0,5 0,5 0,5
12,3 10,8 11,9
Percentage of Total Area
80%
60% 54,3 51,1 50,5
40%
13,2 14,0 13,9
20%
19,7 23,6 23,2
0%
1993 2003 2013
under 0.96 ha 0.96-1.44 ha 1.6-6.24 ha 6.4-22.24 ha 22.4 ha and more
100% 0,5 1,1 0,6 0,3 0,3
11,9 11,2 6,9
90% 16,0 14,8
Percentage of Total Area
80%
70% 44,2
60% 50,5 44,7 44,7 57,4
50%
40% 15,3
30% 13,9 10,5 12,8
20% 14,9
27,7 27,1 33,3
10% 23,2
16,2
0%
Whole Central North Northeast South
Kingdom
under 0.96 ha 0.96-1.44 ha 1.6-6.24 ha 6.4-22.24 ha 22.4 ha and more
Source: National Statistical Office, 2014, p. xviiZooming in: Size of Area
of Holding (cont‘d)
• Only a small share of holdings has an area of 22.4 ha
[140 rai] or more at its disposal (0.5%).
• The majority of all holdings in all regions occupies a
small area of 1.6-6.24 ha [10-39 rai].
• The Central region has the highest share of holdings
with area of at least 22.4 ha [140 rai] (1.1%).Number of Employed
Workers
1 person
2-3 persons
4-5 persons
6-9 persons
10-19 persons
20-49 persons
50-99 persons
100 persons or more
Source: National Statistical Office, 2014, p. 76
• More than half of the total holdings employ only 1-3 workers which
once again illustrates the highly fragmented structure of the
agricultural sector.Use of Machinery and
Equipment
Type Machinery/ Number of Holdings Type Machinery/ Number of Holdings
Equipment reporting the Use (million) Equipment reporting the Use (million)
Total Number of Holdings: 5.9 million Planter and seeder
• Manual 1.09
Tractor 4 wheels 2.24 • Engine 1.12
• Attach to tractor 2 0.14
Tractor 2 wheels 2.43 wheels
• Attach to tractor 4 0.19
Water Pump wheels
• Engine 1.49
Harvesting machine
• Electrical motor 0.34 • Reaper (sugarcane) 0.09
• Natural energy 0.03 • Combined harvester 1.58
Sprayer Thresher
• Manual 1.35 • Rice and cereal 0.53
• Engine 1.32 thresher
Weeder • Corn sheller 0.17
• Manual 1.09 • Rice and cereal 0.2
• Engine 1.12 winnower
Rice mill 1.74
Milking machine 0.01
Source: National Statistical Office, 2014, p. 68Use of Machinery and
Equipment (cont‘d)
• Due to the fragmented structure of the Thai agricultural
business, farmers build on simple, low-scale technology.
The majority of machines/equipment listed above are
used by holdings with an area of 1.6-6.26 ha [10-39 rai].
• The usual horse power of tractors ranges from 30 to 130
HP. Weakly-motorized tractors are used in rice
production. The cultivation of sugarcane requires higher-
motorized machinery. For the production of cassava,
maize and rubber, farmers use medium-motorized
tractors.Type of Agricultural
Activity
100 96,3
Percentage of Total Number of
90
80
70
Holdings
60
50
40
30 22,1
20
10 4,7
0,01
0
Cultivating Crops Rearing Livestock Freshwater Culture Sea salt farm
Source: National Statistical Office, 2014, p.xvi
Note: repondents could choose more than one type of agricultural activity
• The large majority of farms cultivate crops, followed by rearing
livestock.
• Almost 80% of the total holdings focus on one type of agricultural
activity. Involvement in three or more activities is an exception (less
than 2%).
• Given the dominance of crops and livestock, the analysis will focus
on these two areas.Type of Agricultural
Activity by Region
100%
90% 17,3 16,4 15,6 13,1
Percentage of Agricultural
80%
70%
40,3 South
Activities
60% 47,2
56,8 Northeast
50%
40% 86,9 North
30% 21,4
Central
22
20% 17,2
10% 22,7
13,5 9,6
0%
Cultivating Crops Rearing Livestock Freshwater Culture Sea salt farm
Source: National Statistical Office, 2014, p. 19
• The two most significant agricultural activities, namely
cultivating crops and rearing livestock, are primarily
pursued in the Northeastern region, followed with a
large gap by Northern and Southern Thailand.Rice, Field Crops & Rubber LAND USE
Area of Holding by Land
Use
100% 4,7 2,7
7,1
1 0,9 Pasture and other
90% 1,2
21,3 22,5
80% 19,1
Percentage of Total Land Vegetable crop/ Herb/
70% 8 8,6 Flower and ornamental plant
14,6
60% 9,6 11,7
8,5 Field crop
50%
40% Para rubber
30% 55,4 52,3 50,8
20% Permanent crop/ forest
10%
0% Rice
1993 2003 2013
Source: National Statistical Office, 2014, p. xvii
• Half of the total cultivated area was used to grow rice, followed by
field crops, permanent crop/ forest and para rubber.
• During the past ten years the area of para rubber (+70%) and
field crops (+17%) grew considerably.
• The area of permanent crop/forest (-27%) and pasture (-62%)
decreased during the same period of time.Comparing Regions‘ Area of
Holding by Land Use, 2013
100% 2,7 1,6 2,3
0,9 5,5
1,2 0,4 0,3 2,7 Pasture and other
90% 2,1 0,6
22,5 20,9
80% 28,3 33,9 Vegetable crop/ Herb/ Flower
70% 8,1 and ornamental plant
14,6 1,6
3,6 66
60% 8,3 Field crop
8,5 9,1
50% 14,3
40% Para rubber
66,7
30%
50,8 50,6
20% 41,5 24,9 Permanent crop/ forest
10%
0% 5,5
Rice
Whole Central North Northeast South
Kingdom
Source: National Statistical Office, 2014, p. xvii
• Rice is mainly cultivated in the Northeastern region, followed by the
Northern and Central region.
• Field crops account for a considerable share in the Northern region,
followed by Central and Northeast Thailand.
• The production of rubber occupies more than half of the cultivated
land in the South.Production of Rice
Rank Country Production (1,000 t)
1 China (Mainland) 203,290
2 India 159,200
3 Indonesia 71,280
4 Bangladesh 51,500
5 Vietnam 44,039
6 Thailand 38,788
Source: Food and Agriculture Organization, 2013
• In 2013, Thailand was the sixth largest producer of paddy rice.
• Rice production in Thailand is however inefficient. The average
yield per ha was 2.9 t in 2013. Competitor Vietnam achieves
productivity rates of 5.3 t/ha in conventional rice (2010) .The Controversial Thai
Rice Price Policy…
• In 2011, the government under Yingluck Shinawatra
introduced a new rice price policy to cater its electorate
in the rural North. Rice farmers sold their total rice
harvest to the government for a guaranteed price of USD
457-609/t (15,000-20,000 Baht/t) which was 30-40%
more than the global market price. The government in
turn stored the rice and hence sought to centralize trade.
The controversial policy caused tremendous costs (2%
of GDP).
• As the global market leader, Thailand aimed at
increasing the international price for rice. Instead, the
domestic price for rice rose; Internationally, Thailand lost
its competitive edge and was overtaken by India and
Vietnam.…The New Rice Support
System
• Since stopping the rice price policy in June 2014, the
new government has veered away from direct market
intervention to producer assistance. With the help of an
agreement with input manufacturers, production costs
are meant to be cut by USD 83/ha; paddy farmers are to
get better access to short-term credits at reduced loans.
• Thailand is expected to return to the pole position of
global rice exports again in 2015.Number of Holdings &
Area by Field Crop
Field Crop Number of Holdings Planted Area (ha) Harvested Area (ha)
Cassava 621,385 1,503,018.6 1,479,987.4
Sugarcane (industry) 400,305 1,382,649 1,354,807
Maize 405,540 1,196,766.4 1,183,699.2
Mung Bean 8,996 29,333.6 28,430.4
Tobacco 19,116 15,431 15,399
Peanut 16,377 12,080.6 11,986
Soybean 11,636 9,992.3 9,922.4
Sugarcane (Chewing) 5,549 7,682.1 9,151.8
Pasture 1,165 1,998.9 1,998.9
Source: National Statistical Office, 2014, p. 59
• Sugarcane, cassava and maize present the most important field
crops in terms of number of holdings and size of area.Production over Time
100,000
80,000
1,000 t
60,000
40,000
20,000
0,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Sugarcane Cassava Maize
Source: Food and Agriculture Organization, 2013
• The production of the three most important field crops increased
over the past decade, yet at different scales: Sugarcane has
accounted for a rapid growth of 85% since 2000; the produced
amounts of cassava and maize grew by 58% and by 13%
respectively during the same time period.Production of Rubber • 1.17 million holdings produce rubber on in total 2,6 million ha. • 95% of the rubber farmers have small holdings. • With an average yield of 1.7 t/ha, the Thai rubber sector is acknowledged as relatively efficient. • Thailand is the biggest rubber producer in the world: in 2012, Thailand produced 3.5 million t rubber accounting for a value of USD 4 trillion (1/3 of global rubber output). • 90% of the total rubber output is sold abroad. The main export destinations are China, Malaysia, Japan, the EU and the US. • The market price for rubber hit its five-year low in September 2014 of USD 1.60/kg among others due to a slower Chinese demand. The price decline affected the rubber farmers and mobilized protests demanding government support.
Thai Rubber Support Policy • In order to lift the income of rubber farmers, the government adopted a new rubber support policy in September/October 2014: Subsidies: USD 258 million [8.5 billion Baht] for small rubber farmers (≤ 4 ha), USD 30/0,16 ha [1,000 Baht/rai], maximum amount USD 456.50 [15,000 Baht] Loans for cooperatives: Bank for Agriculture and Agricultural Cooperatives provides USD 152 million in loans for two dozen cooperatives to support rubber processing Restricting output and reducing stockpiles: 1. To slow rubber tapping, Thailand will cut down old rubber trees on an area of 64,000 ha within seven years. This measure will result in an annual supply cut of 27,000 t. 2. The Thai government will encourage rubber farmers to grow crops or raise livestock on vacant land. 3. The national rubber stockpiles are to be reduced by requiring higher rubber content, e.g. in road paving and mattress manufacturing.
Milk, Meat & Eggs LIVESTOCK
Livestock and Holdings
Beef Dairy Pigs Layer Broiler
Cattle Cattle Chicken Chicken
Number of 592,699 169,587 616,417
Holdings
Total Stock 3.15 0.4 4.43 102.69 123.1
(million)
Average 6.3 26 399
Number 2051 2,8701 6422
large-scale
farms
Source: National Statistical Office, 2014, p. 60ff.
1 300 and more animals; 2 50,000 and more animalsBeef and Buffalo Meat
450000
403750,51
400000
350000
300000
250000
tonne
203234,76
200000
150000
100000
50000
0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: Food and Agriculture Organization, 2013
• The production of beef and buffalo meat has increased over the
past decade by 42%. Yet, the amount has never reached the all-
time-high of almost 404,000 t of 1993 again.Milk Production
1200000
1064000
1000000
888220
800000
tonnes
729098
600000
400000
200000
134011
0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: Food and Agriculture Organization, 2013
• Thailand extended its milk production capacities over the past two
decades significantly. Between 1992 and 2012, the amount of milk
increased by almost 800%.Milk Production (cont‘d) • Four provinces located in the Central and Northeastern region feature a high density of dairy cattle: Saraburi (central), Nakorn Ratchasima (northeast), Lopburi (central), Ratchaburi (central) • With an average amount of 12 kg/cow/day, the productivity in the dairy sector is low. • The area to grow pasture and rouphages is insifficient so that farmers require alternative fodder. • Thailand has a negative trade balance in dairy products. The main import dairy products are skimmed milk powder, whole milk powder and whey. The country exports condensed milk, sweetened condensed milk and milk and cream (not concentrated) to other countries in ASEAN. • The government provides funding to help manage dairy cooperatives and launched pilot projects to enhance technology transfer to dairy farmers.
Chicken and Pork
1400000 1263358,43
1268154,74
1200000
1000000 867914,19 1056576,8
800000
tonne
883577,24
600000
400000
200000
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Chicken Pork
Source: Food and Agriculture Organization, 2013
• The production of pork and chicken is on the rise: chicken meat production
recovered after the avian influenza in 2003/2004 and almost reached the all-
time-high again in 2012. The production of pork has increased over the past
ten years by one third.
• In 2012, chicken meat and pig meat accounted for a production value of
USD 1.8 billion and USD 1.6 billion respectively. They ranked 5th and 6th on
the list of the top ten commodities in terms of production value.
• Meat exports have almost quadrupled since the mid 1990s.Egg Production
1200000
1051000
1000000
866817
768000
800000
tonnes
600000 693360
400000
200000
0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Source: Food and Agriculture Organization, 2013
• The production of eggs increased by 36% over the past twenty
years. After the first wave of avian influenza in 2003 resulting in a 15-
year-low in output, production capacities have caught up fast.
• In 2012, eggs accounted for a production value of 1.1 billion USD
and hence was the 8th most important commodity in terms of
production value.Biomass & Biogas RENEWABLE ENERGY
Bioenergy on the Rise • According to the Alternative Energy and Development Plan (AEDP) 2012-2021, Thailand aims at increasing the share of renewable energies to 25% of total energy consumption by 2021 (13.9 GW). • Biomass is meant to contribute 4.8 GW in 2021 (2012: 2 GW). In 2013, almost 1,000 biomass power plants were in place, mainly in Northeastern, Central and Northern Thailand. Sources for biomass energy are primarily agricultural waste or byproducts, including rice husks, sugarcane waste, oil palm wastes etc. • The capacities of Thai biogas plants are to be expanded the most: in 2021, biogas is meant to account for 3.6 GW (2012: 193 MW). In 2013, 156 biogas power plans were on grid, primarily located in the South, followed by Central Thailand. The main raw materials in the production of biogas are industrial waste, farm waste, waste water and municipal solid waste. In order to increase the production of biogas, the Thai government promotes the development of energy crops, especially fast-growing, high-energy grasses, such as Napier and Bana.
Subsidies for
Bioenergy*
• In 2013, the former government launched a financial support
program for biogas power plants of 1 MW or smaller using
Napier grass. 13 projects were supported with 20% of total
investment (max. USD 610,000 [20 million Baht] each).
• A feed-in-tariff of at least USD 0.14/kwh [4.5 Baht/kwh] was
defined for power generated by biogas of 1 MW or smaller for
a period of 20 years.
• The Department of Alternative Energy Development and
Efficiency (DEDE) is planning to give subsidies worth USD
9.16/t of raw material crops to farmers [300 Baht/t] . DEDE
proposed sites for the cultivation of Napier grass which are
located in the Central and Northeastern region.
*The information provided here is a snap-shot. The interims government is
in the process of comprehensive reforms which may also target subsidies
for bioenergy.Summary & Political Outlook TRENDS IN THAILAND‘S AGRICULTURAL SECTOR & POLITICS
Summary • The Thai agricultural sector features a high degree of fragmentation, resulting in small farms, use of low-scale machinery and equipment. • Almost all holdings cultivate crops, especially rice, sugarcane, cassava, or maize. • Rearing livestock, particularly pigs and chicken, is on the rise. • The following commodities feature particularly high growth potential: Field crops: sugarcane, cassava, maize Livestock: milk, meat (beef, pork, chicken), eggs Energy Crops, esp. Napier and Bana grass • Thailand seeks to increase the production of energy from alternative sources, among others biomass and biogas.
Political Outlook • After half a year anti-government protests that left at least 28 people dead and the government paralyzed, the army seized power on 22nd May, 2014 in a bloodless coup overthrowing the government of Yingluck Shinawatra. Shinawatra had been elected Prime Minister of Thailand three years before. • Army commander and head of government General Prayuth Chan- ocha initiated constitutional reforms which are, according to official rhetoric, meant to strengthen democratic principles in Thailand‘s political system. Critics argue that General Prayuth rather aims at constraining influence of the people. • The next General Elections are tentatively scheduled for October, 2015. • In order to overcome the ethnic-based division between the capital- based elite and the rural population and thus to stabilize the country in a sustainable manner, efforts to level out the development gap will be necessary.
Sources Asiabiomass (2014): Promoting Napier Grass/ Biogas Power Generation in Thailand Bangkok Post (2014): Rubber farmers agree to drop protest amid industry reforms, 19.09.2014 Bangkok Post (2014): B8.5bn approved for rubber subsidy, 16.10.2014 Department of Alternative Energy Development and Efficiency (2014): Energy in Thailand. Facts & Figures 2013, Bangkok Department of Alternative Energy Development and Efficiency (2013): Integrated biogas production from energy crops, Bangkok Food and Agriculture Organization (2013): Thailand, FAOSTAT, retrieved on 29 October 2014 Food and Agriculture Organization (2014): Rice Market Monitor July 2014, Volume XVII, Issue No.2 Food and Agriculture Organization (2014): Rice Market Monitor October 2014, Volume XVII, Issue No.3 GTAI (2012): Thailands Kautschukwirtschaft ist weltweit führend, 18.12.2012 National Statistical Office (2014): Advanced Report 2013 Agricultural Census, Bangkok Seidel, Jan/ Adam, Rainer (2013): Thailand: Agrarpolitik in der Sackgasse, Friedrich Naumann Stiftung, Nr. 11/2013 The Telegraph (2014): Thailand‘s military rulers plan elections for October 2015, 28.6.2014 Worldbank (2014): World Development Indicators
Contacts Dr. Imke Pente imke.pente@mercator-fellows.org Daniel Müller mueller@oav.de
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