Agriculture is a large industry that plays a major role in the economy of the country.  By virtue of the size of this sector and the large number of people it provides employment for - 18 million (60% of the national workforce) - it also plays an important social role.  

• Despite the large number of people employed, agricultural production accounts for only13% of GDP the industrial sector employs 12% of the labor force but contributes 32% to the GDP.
• Over the past few decades, agricultural expansion has occured because of forest clearing.  Farming is now the main use of land in Thailand.
• Arable land comprises 34% of Thailand's land area of 511,115 square kilometers.

The breakdown of land use in Thailand

• Thailand is a world leading producer of rubber pineapples and prawns.  The country is also a top exporter of  rice and tapioca, which account for about 25% and 85% respectively of total world exports.
• Agriculture is a traditional industry of Thailand, in the not so distant past, most Thai's were involved in farming.
• Farmers grow many different products including cereals, sugar, vegetables, fruits, nuts, pepper, flowers, tobacco and cotton. Paddy is the most important.
• Thai agriculture has diversified although crops are the mainstay, generating 60% of the agricultural revenue. The rest is derived from fisheries, livestock, forestry, simple processing and agricultural services.

Use of farm land

• Development of the agricultural sector is restricted beacuse of  individual farm size and, becuse of the relaince on commodity exports,  exposure to volatile prices.

Composition of farms by region

 

Region Number farms Average size (Rai) Northeastern 2,273,549 25.50 Northern 1,293,997 22.60 Central plain 879,835 30.96 Southern 801,434 22.66

• A large scale food processing industry is fast replacing the production of agricultural commodities such as  rice, cassava, sugar cane, maize and rubber. (Agro-industry has been designated in Thailand's National Economic and Social Development Plan as the linkage between the traditional agricultural society and the expanding industrial base).

• With a fleet of 50,000 vessels, Thailand is one of the world's largest seafood producers. It also has a large prawn farming industry.
• Frozen fish exports, mainly prawns, were valued at US$2.5 billion in 1996 and canned fish exports were worth US$805 million.

• Thailand is a major producer of chickens for domestic consumption and export. The CP Group (Charoen Pokphand) of Thailand, the world's largest chicken producer and animal feed miller, typifies the commitment and investment in this sector by Thai industry.

Present situation

• Reduced availability of farmland and weak commodity prices are placing the agricultural sector under pressure. In 1999, the price of agricultural products fell, this trend will continue in 2000. 
• Rice remains the staple agricultural product in Thailand, however the dominant position of rice in the diet is being eroded as people change consumption patterns and farmers switch crops to more lucrative and higher yielding products.
• The per capita rice consumption is estimated at about 110 Kg/year.
• About 60% of the population of Thailand is dependent on agriculture and related activities for at least part of their income.
• A shift in planting patterns has taken place from rice, cassava, coffee and pepper to livestock, floriculture and fish farming.
• Wheat production is gaining popularity, but remains only a minority crop (1998/99 season only 1,400 tons were produced).  Farmers are reluctant to plant wheat because the price is low (poor protein content) and yields are poor.
• Three varieties are used by farmers in Thailand – Samoeng 1, Samoeng 2, and Fang 60.
• Wheat is not a direct substitute for rice.
• Wheat flour for human consumption is in the form of: bread and cake (35%), noodles (30%), all purpose (25%) and biscuit (10%).
• Due to the small amount of wheat produced locally, most is imported at the rate of about 600,000 tons/year.
• Thailand's pulse production, mainly mung bean and black matpe, is about 190,000 tons.
• Mung bean is utilized to make mainly vermicelli and bean sprouts, smaller quantities for bean flour and cake, candy and sweets, feedstuffs and seed. 

Some examples of production costs and return on sales

               Bangkok Post Year end review 99                                 Units baht/ton

• Competition from regional neighbours is on the increase.  Compared with 1998, output by other agricultural countries in the region, especially leading producers of rice, rubber, sugarcane, tapioca and palm oil, is on the rise.
• Current agricultural policies are geared to increasing productivity and adding value to basic products.
• Among new developments for 2000, will be the establishment of a commodities market.  The intention is to stabilize prices of agricultural commodities.
• Initially, four products will be traded on the market: rice, rubber, tapioca and prawns.
• A new agricultural policy is in the implementation stage; the goal is to better address the needs of individual crops.  This will be achieved by classifying products into three groups.  Specific production and marketing strategies will subsequently be developed for each group.

Group 1.  Export crops such as rice, tapioca, rubber, coffee, vegetables, livestock, prawns and poultry.

Group 2.  Products for which there is an insufficient supply for domestic consumption and some imports are required, such as maize and soybean.

Group 3.  Crops Thailand has to import, such as cotton.

• Long-term export competitiveness will be strengthened by focusing on curbing oversupplies, reducing production costs and improving production efficiency.
• A zoning system for each commodity (rice, tapioca, rubber, sugarcane, pineapple, maize, soybean, palm oil, coffee, chickens, pigs, and black tiger prawns) will enable output to be regulated.

Return page top?

©Copyright 2003 Agro Food Resources Ltd. For more information, contact Agro Food Resources