Author Topic: What are the costs of starting a rubber tree farm in Thailand?  (Read 9367 times)

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Start-up Costs

This discussion about costs excludes money expended to purchase land.

These prices are as of the date of this post.

First, you need to prepare the land for planting.  The land needs to be clear of all other trees and vegetation.  The land should have a slight slope to it to allow for excess water run-off so you do not get any water stagnation.  The costs of this will vary based on how much clearing needs to be done.  A tractor usually charges about 225 baht a rai to plow the land.  A very large tractor for clearing trees, etc can be as much as 500 baht a rai.

The initial purchase of trees currently are at about 50 baht each.  Rows are generally about 6 or 7 meters apart with trees spaced at about 3 meters in the row.  This may seem like wide spacing, but when the trees mature they will form a canopy to cover the land.

You will need to pay workers about 200 baht per day to plant and fertilize the trees.  A worker can plant about 150 trees a day. Plus, you are expected to provide lunch and water for the workers each day. Initial fertilizing of the trees will cost about 2 baht per tree at the time of planting.

Let's assume you are planting 2,000 trees on 25 rai of cleared land, here are some estimated rounded costs:

Tractor: 6,000 baht
Trees: 100,000 baht
Workers: 3,000 baht
Fertilizer: 4,000 baht

So your initial costs are about 113,000 baht - not including the cost of land.

It is normal to have several defective trees that will die.  Out of your 2,000 trees, you should have a 90% survival rate.  Plan on buying and replanting about 200 trees a few months after the initial planting.

After planting, you have about 7 years of maintenance before the trees are mature enough to produce rubber.  So let's calculate the cost for these 7 years.

Annual costs:
Fertilize 3 times a year (2,000 x 7baht): 14,000 baht
Workers to apply fertilizer: 4 workers, 2 days, 3 times = 6,000 baht
Workers to control weeds around the trees: 2 workers, 3 days, 3 times = 4,500 baht
Fertilizer: 5 bags @ 650 baht, 3 times = 9,750 baht
Tractor to plow between trees, 25 rai @ 220/rai, 2 times = 11,000 baht
Pruning the trees - you can do yourself so no cost

Annual total = 45,250 baht x 7 years = 316,750 baht
Plus initial planting costs 113,000 baht

Total estimated costs = 429,750 baht to get the farm to the point of production and starting a revenue stream.