February 8, 2007

 

Thai shrimp producers calling for timely information

 

 

Thailand may lose its status as a major shrimp exporter if the government cannot provide market information that helps exporters manage their risks, industry experts said.

 

The Bangkok Post reported that Thailand has been a top shrimp producer for years and is poised to ship 336,045 tonnes of shrimp this year despite intense competition from rivals - Vietnam, China, India and Indonesia.

 

Anurat Khokasai, chief marketing officer of Union Frozen Products Co Ltd (UFP), a major Thai seafood exporter, said.

 

Thailand can no longer compete with its rivals in terms of labour costs as China and Vietnam are offering wages twice as low as that in Thailand, Anurat said at a seminar on competitive strategies for the country's food industry.

 

Chinese farmers have also eliminated clay odours in their shrimp by lining their ponds with vinyl.

 

Still, Thailand faces more favourable trade policies compared to China.  While Chinese shrimps face an anti-dumping (AD) tariff rate of 100 percent imposed by the US government, Thai products are subject to a rate of 5.92 percent in the US market, he said.

 

The generalised system of preferences (GSP) granted by the European Union also helped boost the export volume of Thai shrimp by nearly 90 percent in 2006. The NFIT estimated the export revenue of Thai shrimp would increase by 20 percent last year.

 

Given tougher competition, major exporters in Thailand have tried their best to make their products more competitive in terms of price, quality and service. However, they need government help to obtain accurate market information, Anurat said.

 

For example, these could come in the form of demand-supply analysis and updated trade laws in export destination countries, he added.

 

These information would enable efficient risk management that would help exporters to cope with intense competition in the global market, he said.

 

Setting to goals and sticking to them is also paramount. UFP set a goal for its marketing department to generate income of THB 8.5 billion (US$250 million) last year and required that the production department spend only 5 percent of overall cost for its operations, compared with 7 percent in the previous year.

 

Raw material prices were to be kept at less than 70 percent of the selling prices of end-products and storage of non-moving items were reduced in warehouses to cut down on logistics costs, he said.

 

Thailand is expected to export 553,296 tonnes of canned tuna and 333,700 tonnes of raw chicken meat and processed chicken this year.