December 28, 2004

Shrimp Exports Seen To Accelerate Charoen Pokphand's Sales Growth

Charoen Pokphand Foods has projected that sales growth will accelerate in 2005 on rising shrimp exports. The company is Thailand's biggest publicly traded food and meat exporter by market value.

According to Chief Executive Adirek Sripratak, sales next year may increase 11 percent to a record 100 billion baht ($2.6 billion) assisted by rising shrimp exports. Sales in 2004 are forecast to rise 8 percent to 90 billion baht.

The US Commerce Department had lowered tariffs on Thai shrimp imports to as much as 6 percent on December 20, down from a 10.3 percent preliminary tariff proposed in July. The Thai Shrimp Association has said that the country's shrimp exports may rise by 20 percent to 270,000 tons in 2005 on lower US tariffs.

"US buyers began ordering shrimp from Thailand again after the ruling,'' Adirek said. "The increase in shrimp farms also increased our sales of feeds and baby shrimp.''

Charoen Pokphand also expects to sell more shrimp to Europe as the European Union may cut import duties next year, he said.

The EU parliament in Brussels is in the process of approving a reduction in Thai shrimp tariffs, and a decision may be completed by the end of March.

The company's domestic farmed-shrimp sales may also increase over the next few months after tsunamis caused by an earthquake off Indonesia damaged a significant portion of the nation's shrimping fleet, Adirek said.

"It will take some time to build new fishing boats,'' Adirek said. "Most of the shrimp are caught from the Andaman sea.''