Thailand might not be one of the first countries to spring to mind when it comes to Asia’s largest fresh produce hitters, but the Kingdom of Smiles is still mighty in its own right. With a population of 64.1 million people and the second largest economy in south east Asia, Thailand grows a rich array of fruit and vegetables.
Similarly to other Asian countries, Thailand is keen to increase export trade and in recent years has entered into a spate of agreements. The signing of a Free Trade Agreement with China in October 2003 has led to a surge in trade, although in many ways, China appears to have benefited more than Thailand.
Thailand is sure to learn from this and marketers hope that the country’s recent trade agreements with New Zealand will bolster Thailand’s fruit industry. Currently, the country is excluded from shipping to New Zealand because of sanitary and phytosanitary barriers. However, analysts are hoping that Thailand’s stronger focus on food safety issues will open New Zealand’s potentially lucrative doors.
While most of Thailand’s export volumes land in nearby markets such as China, Singapore, and Japan, producers are also keen to grab opportunities further afield and are focusing their range on Europe.
Indeed, a number of Thailand’s export companies enjoy strong relationships with the UK and the country has consistently and quietly exported quality fresh produce for a number of years.
Thai fruit can be classified into two groups: seasonal and year-round crops. The seasonal crop includes mangoes, durians, rambutans, longans, mangosteens and lychees. The latter group consists of fruits such as pineapples, bananas, papayas, and jackfruit.
In terms of volumes, longan represents one of the largest fruit crops in Thailand. Estimates vary depending on association, but according to Thailand’s Agricultural Extension Department, the crop normally weighs in at around 0.4-0.5m tonnes. Already familiar to the UK’s Asian population, the so-called “king of fruits” is also gaining ground among the mainstream population.
Thailand already enjoys a reputation as a reliable supplier of high quality goods and many producers are keen to fulfil their export potential.
KC Fresh supplies a range of fruit and vegetables to the UK, shipping baby corn and asparagus to retailers and exotic fresh produce to both wholesalers and restaurant chains.
The company works with a leading UK importer and became active in the UK in 1999. KC Fresh is planning to expand the products it supplies, starting with its stir fry vegetable packs to Sainsbury’s.
According to the company’s Chusak Chuenprayoth, UK consumers are an adventurous bunch who enjoy trying new products. Marketers are hoping that this should provide strong opportunities for producers keen to introduce their wares to the market.
Similarly to other producers, KC Fresh notes that the UK is demanding in terms of quality and variety, perhaps more so than any other European country.
Fresh Partners’ Fons Arents agrees, adding that UK supermarkets are especially keen on offering colourful packaging to their consumers.
As well as the UK, KC Fresh is also working to expand in other European markets, principally Switzerland, the Netherlands, Austria and Russia.
In recent years, the company has increased its investments in Vapour Heat Treatment (VHT) machinery. This is in order to supply mango, mangosteen, lychee and pomelo to a range of markets such as Japan, Korea, China and Australia.
Fresh Partners is another baby corn supplier to the UK but the firm also supplies green asparagus, rambutan, mangosteen and lychee. The firm has been shipping to the UK for more than 15 years under its brand Thai Fresh.
According to Arents, earlier in the decade volumes increased by around 30 per cent per annum.
However, growth dipped slightly last year due to greater price competition in the marketplace. Furthermore, Fresh Partners incurred higher airfreight costs and more outgoings as the company worked towards HACCP and EurepGAP accreditation.
However, it’s been a good season so far for Fresh Partners which recently increased its seafreight shipments of lychees to Europe. The company sources lychees from northern Thailand in the Chiang Mai area. While producers there began winding down in May, rambutan growers remain active.
“Rambutans will be available in the coming months and this is one of the most important airfreighted fruits,” Arents says, adding that mango is another fruit which is only airfreighted to Europe.
According to Arents, the Nam Dok Mai variety attracts the most attention and very strict residue checks are conducted on this mango.
Meanwhile, Arents identifies two groups of consumers in the UK. One is the Oriental and Asian customers and the other is the indigenous population. He believes that there are strong opportunities to bring Thai produce to the latter group as supermarkets and their consumers request high value, unusual products.
“We can pack for each importer or supermarket according to its specifications in a state-of-the-art perishable centre,” Arents says.
Dutch-based firm Kappa Packaging has been supplying Fresh Partners with solid board packaging for almost a year. “We send packaging from Holland to Thailand for Fresh Partner’s exotic fruits,” says Kappa Packaging’s Henk Jan Meints. The company provides solid board packaging, which it claims gives better resistance against moisture.
“One of the other benefits of solid board packaging is that it’s made of thinner material than corrugated packaging so you can get more fruits in a carton,” explains Jan Meints, adding that the company is keen to establish an office in Thailand and use it as its headquarters in Asia.
Asia Exotic Corporation Limited is another Thai company keen to expand its sphere of influence. “We ship Thai fruits such as lychee, durian, longan, rambutan and mangosteen as well as Thai herbs, baby corn and asparagus tips to the UK,” says the company’s Boonmee Wongshotisatit.
Asia Exotic Corp began shipping to the UK in 1998 and believes there is room for further growth in this market. Exotic fruits and baby corn in particular are likely to make further in-roads as more consumers become accustomed to the vast array of Thai produce.
At present organics do not feature in the company’s short-term outlook. However, Wongshotisatit notes that Asia Exotic Corp could develop this category in the next two to three years.
Fresh Partners is one firm that supplies organic produce. However, the company has reported limited interest, possibly due to the higher prices asked for organics. “It’s important to note that we are very keen on pesticide-free production and all our contract farmers are under our control,” Arents says.
“We give them the seed, teach them how to produce for the export market and show them our demonstration farm. Every year we invest in new techniques and new local projects specifically on the production side.”
When the Journal spoke to UK importers about their Thai activities, many remained guarded about the firms they were working with and the volumes involved.
“There’s only a few importers handling Thai produce and many don’t want to disclose what they’re doing,” said an importer who declined to be named.
However, marketers do concede that Thai fresh produce has a lot going for it. “Consistent quality and year round availability makes Thai baby corn attractive to UK importers,” said a Wealmoor spokesman. “But high airfreight rates can push up prices.”
If Thailand follows China’s lead and continues to develop and invest in its fresh produce industry, marketers hope that the country will fulfil its export potential.
TESCO’S TASTE OF THAI
Tesco is getting into the summer mood and is busy preparing for its one-week campaign ‘Taste of Thailand’ to promote Thai exports. The campaign will run from August 3-10 in five of its stores in the greater London area. The stores participating are Beckton, Lea Valley, Hayes and Yedding Extra outlets as well as its Brent Park superstore.
“We’re showing our support for Thai exports,” says Greg Sage, Tesco’s international corporate affairs manager. “Tesco has been working with the commercial department of the Thai embassy to see which products will have the most consumer appeal.”
Custard and Rose apples, coconuts, mangoes and rambutan will be among the fruits promoted, and herbs such as basil will also get a look-in.
There’ll be in-store samplings and consumers will also get the chance to win holidays to Bangkok and Phuket.
“Consumers are already aware of some fruits like lychees, which we source regularly from Thailand, and mangoes, but custard apples are still unknown to many,” Sage notes.
“Also, more people are going abroad and trying new things and they want to eat the fruits they tried on holiday when they get home.”
The Taste of Thailand campaign will also encompass Thai groceries such as cooking ingredients and pulses.
THAI FRUIT FALL
Thailand’s fruit production could fall by as much as 10 per cent this year, with lower durian, rambutan and pineapple volumes accounting for the downturn, according to the Agricultural Extension Department (AED).
Durian production is expected to drop by nearly 10 per cent to 460,000 tonnes. Rambutan output will fare worse, with volumes likely to drop 13 per cent to 310,000 tonnes. This season’s drought is also expected to result in smaller-sized pineapples. Previously, production was expected to total one million tonnes.
However, Thailand’s popular mangoes and mangosteen have largely been unaffected, said Thongchart Raksakul, director general of AED, adding that rains in Thailand’s eastern region brought some relief to crops.
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