Note: 1 Rai is equal to 0.16 Hectares
- Thai mills are paying farmers a record price for their cane this season.
- This should mean that farmers plant more cane in the future, and not competing crops like cassava.
- We currently think Thailand will crush 100m tonnes of cane in 2021/22, up 30m tonnes year-on-year.
Thai Cane Production to Rebound in 2021/22
- With each new season, Thailand’s farmers must decide which crop they should plant.
- Their decision is made based on projected earnings, any potential weather risk and their agricultural needs (crop rotation).
- In the first instance, cane is the clear winner next season, offering farmers the strongest returns on record.
- Thailand’s cane farmers suffered hefty production losses in the recent drought-hit seasons meaning some may be slightly wary as other crops, such as cassava, have a renowned resilience in such conditions.
- However, the Thai Meteorological Department thinks Thailand will receive 20% more rain than usual between February and April, which bodes well for cane.
- The only exception is the Northeast, which is set to receive 10% more rain than usual.
- More generally, farmers are encouraged to switch what they plant every two to three years.
- This practice, known as crop rotation, helps farmers optimise soil nutrition and avoid pest infestations/disease.
- This will suit the farmers that turned to plant cassava for the last two seasons as they’ll be due a change-up.
- All things considered, we think Thailand’s cane area will increase to 9.7m Rai in 2021/22, up 1.4m Rai year-on-year.
- Rice, cassava and corn planting will be down 1.2m, 303k and 241k Rai respectively.
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