December 14, 2010

 

Thailand plans to use soymeal tariffs to lower farm production costs

 

 

The Thai government plans to use the tax charged on imported soymeal to lower the production cost of chicken, pork and eggs to cut its retail prices.

 

The strategy is part of a broader policy to cut the price of some foods and liquefied petroleum gas (LPG) to reduce the cost of living, local news reports.

 

Arkhom Termpittayapaisith, secretary-general to the National Economic and Social Development Board, said the programme was meant to assist small farm raisers of pork, chicken and eggs.

 

Soymeal is a raw material in the animal feed industry, and the tariff revenue is quite high at about THB500 to 600 million (US$16.64-19.97 million) a year – sufficient to finance small farmers buying cheaper ingredients to make feed meal.

 

Normally, Thailand imposes a 2% tariff on imports of soymeal under the quota system approved by the World Trade Organisation. Any imports from non-WTO members will be charged 10%.

 

Small raisers including farm co-operatives control only about 20% of meat and egg production in the country. The majority is produced by large private companies.

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