Thailand pledged on Tuesday (October 28, 2008) to purchase up to 500,000 tonnes of domestic corn and to ban imports, in order to shore up falling local prices, a government official said.
The intervention scheme, which would offer farmers THB 8.5 per kg of the grain, would begin on November 1 and run to December 30, said Yanyong Puangrach, head of the Department of Internal Trade.
Yanyong said the government had also banned imports indefinitely to protect farmers from cheaper corn imports.
The ban would be lifted only if the government was sure that farmers would not be hurt by imported corn, he added.
Last year, Thailand imported 200,000 tonnes of corn, up from 120,000 tonnes in 2006.
Countries worldwide are moving to support their farmers as grain prices collapse, a stark contrast to when grain prices were sky high just some months ago.
Thailand is expected to produce 3.7 million tonnes of corn in 2008, up from 3.6 million tonnes in 2007. Exports were offered at US$300, compared with US$240 offered for Indian and Brazilian corn.
Yanyong said the committee will discuss the issue soon as they would submit their soymeal tariff cut proposal to the cabinet before December.
The cabinet was expected to agree on the policy in November so that it could be implemented by January 1, 2009, said a senior Commerce Ministry official.
Thailand has so far imported 1.2 million tonnes of soymeal this year, compared to 2 million tonnes last year. Most of the imported soymeal were from Argentina and the US.