Financial Management and Behavioral Patterns of Smallholder Rubber Farming Households in Lower Northeastern Thailand

Abstract

Background and Aims: Smallholder rubber farmers in lower northeastern Thailand face critical challenges in financial management, particularly high debt burdens and income volatility from fluctuating rubber prices. This study aimed to: (1) examine financial management patterns and behaviors of smallholder rubber farmers, (2) identify factors influencing financial management performance, and (3) develop an appropriate financial management framework to enhance business sustainability and reduce financial risks for small-scale rubber farmers.

Methodology: A cross-sectional survey was conducted with 400 smallholder rubber farming households (≤30 rai) (n=400) across 8 provinces in lower northeastern Thailand during 2024, using proportional stratified random sampling. Data were analyzed using descriptive statistics and multiple regression analysis. Qualitative data from focus group discussions (30 participants) were analyzed through content analysis to develop practical financial management guidelines.

Results: Households earned an average annual income of 288,130 baht, with rubber accounting for only 40.59% of total income, reflecting income diversification strategies. Approximately 70% of households carried an average debt of 231,642 baht (debt-to-income ratio of 80.40%), while 65.50% maintained savings averaging 58,932 baht. Major financial problems included rising production costs, low rubber prices, and household expenses exceeding income. Regression analysis (R² = 0.624, F = 39.846, p < 0.001) revealed eight significant factors. Positive influences included household accounting practices (β = 0.342, p < 0.01), education level (β = 0.089, p < 0.01), savings amount (β = 0.00004, p < 0.001), regular income (β = 0.00014, p < 0.01), and plantation size (β = 0.022, p < 0.01). Negative influences included financial management problems (β = -0.267, p < 0.01), amount of debt (β = -0.00003, p < 0.01), and non-agricultural expenses (β = -0.00002, p < 0.05).

Conclusion: Household accounting practices and education level emerged as the most influential positive factors, while debt burden posed the primary obstacle to effective financial management. The study recommends a four-dimensional framework: (1) promoting financial literacy and accounting practices, (2) developing context-appropriate financing mechanisms aligned with agricultural calendars, (3) implementing effective debt management strategies, and (4) encouraging income diversification through agroforestry systems and alternative income sources to build financial resilience among smallholder rubber farming communities.