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Published on November 17, 2007

Thai food exports next year will show continued growth despite negative factors like high oil prices, the stronger baht and inflation, says Department of Export Promotion (DEP) director-general Rachane Potjanasuntorn.

He said global oil prices would increase production costs, while exporters would face high inflation.

"Therefore, Thai food exporters should be good at cost management," he said.

Rachane estimates that the growth rate for food exports from Thailand this year could increase to 10 per cent from last year, higher than the target of 9.4 per cent. He believes that next year, the food-export market will grow at a rate similar to this year's.

"Although Thai food exporters will confront many negative factors next year, I still believe food-export figures will not be worse than this year's. The department expects this sector to grow at least 10 per cent, because it's still one of the strongest export sectors for Thailand," he said.

Early this year, the DEP forecast total export sales of US$145 billion (Bt4.91 trillion), up 12.5 per cent from last year, while food exports were targeted to reach $14 billion, up 9.4 per cent.

Rachane said the US remained Thailand's main market but that the EU was the best potential market, with 26-per-cent growth from last year. Sales revenue in the EU market was $1.4 billion.

Thai Frozen Foods Association president Poj Aramwattananont said many food exporters had suffered from the strong baht, especially in the frozen-seafood sector. This factor is major obstacle for growth in food exports this year.

He recommended food exporters diversify to produce value-added foods like ready-to-eat and ready-to-cook products.

"People's lifestyles globally have changed. They tend to prefer ready-to-eat products, because those are faster and more convenient, so Thai food exporters should head to this new market," he said.

Segsarn Trai-Ukos, corporate affairs and business development director of Cencar, operator of Carrefour hypermarkets, said Thailand had lost food-export markets to other countries in Southeast Asia due to the baht's appreciation.

Nalin Viboonchart

The Nation