'Historic opportunity' for Talaad Thai

Economy November 27, 2013 00:00

By The Nation

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Market owner plans Bt2.6 bn project, aimed at making Thailand wholesale hub for AEC fruit, vegetable wholesaling



Talaad Thai, a large fruit and vegetable wholesale market near Rangsit, has announced a major investment and business alignment programme aimed at helping to position Thailand as the hub for the Asean Economic Community’s Bt2.7-trillion wholesaling trade in fresh fruits and vegetables.
Thai Agro Exchange Co, the owner of Talaad Thai, expects its revenues to reach about Bt1 billion this year, up from Bt900 million posted in 2012.
Chairman Pradit Phataraprasit said annual sales at Talaad Thai among its 3,000 traders were estimated at about Bt180 billion. He aims to take this to Bt500 billion in 10 years after entering the AEC.
“We are investing Bt2.6 billion this and next year to grab for Thailand hub status in the AEC’s wholesaling trade in fresh fruits and vegetables,” he said.
He said Talaad Thai and its sister market, SiMoomMuang, handled about half of Thailand’s fresh fruit and vegetable wholesaling, with more than 15,000 tonnes of produce passing through the markets every day.  That gives Thai Agro Exchange a huge opportunity to position Thailand proactively as the hub for this sector in the emerging AEC, he said, adding that the strategy was to move fast and invest substantially.
“Thailand has a huge, natural competitive advantage in this region in the fresh fruit and vegetable wholesaling business because it is a country with a very strong agricultural base. It therefore has a real opportunity also to become the fresh fruit and vegetable wholesaling hub for the AEC in the same way that the Netherlands is the fresh fruit and vegetable wholesaling hub for all of Europe.” 
He said agriculture was a core pillar of Thailand’s economy and the country’s largest employer, with almost 15 million people working in the sector.  
“If Talaad Thai succeeds, it can help the entire agricultural sector in Thailand by opening up new markets in the region and giving millions of Thai farmers access to new buyers for their produce throughout AEC.  Easy access to new markets will quickly translate to better prices for their produce,” Pradit said.
“I see this as a historic opportunity in the same way that Thailand had a historic opportunity in the 1990s to become the auto-manufacturing hub for the region. It is an opportunity for a limited amount of time and if Thailand does not grab it, another country will.” 
Graham Sanders, chief executive officer of Thai Agro Exchange Co, said: “As part of this strategy, we are adding services that are in line with the needs of the modern trade.  
“We are opening a new refrigerated product consolidation centre in Talaad Thai that will supply goods to the modern trade, and Tesco Lotus will be one of the anchor customers using our centre. 
“The consolidation centre is capable of handling 1,000 tonnes of refrigerated product per day. In early 2014 we will invest Bt1 billion to expand that capacity to 3,000 tonnes a day as well as add processing, packing and refrigerated storage. The expansion will make this a very modern refrigerated logistics centre to support our existing wholesale market customers as well as the modern retail trade.”
He said Talaad Thai also opened a new container yard on November 8 that was designed to facilitate the trade in imported fruits and vegetables. The yard was built with an investment of Bt130 million and can handle 13,140 containers a year.  
The fresh-fruit sector is one of the fastest-growing import categories in Thailand, and expanded more than 26 per cent last year to be worth Bt24.663 billion.
“If we invest quickly, we can install the essential infrastructure needed to support the growth of this trade and make Thailand a hub for the entire region,” Sanders said. “We are now in the process of evaluating investment of an additional Bt600 million for the purchase of more land near Talaad Thai and further construction to increase our container yard capacity to 60,000 containers annually.” 
He said Talaad Thai market’s core infrastructure was also being upgraded with a budget of Bt900 million.  A 2-kilometre-long fibre-optic backbone, four drainage pumps, each with a capacity of 500 cubic metres per day, and two new water-treatment plants are being installed and are to be followed by other major renovations and construction at the site.
“This investment is the beginning of our commitment to upgrade and modernise the infrastructure at Talaad Thai. Our objective is to build and operate the best wholesale fruit and vegetable market in Southeast Asia,” he said.
Talaad Thai is also conducting a feasibility study to convert the 55,000 tonnes of organic waste produced annually at the market into electricity as a part of its commitment to improve its green credentials, he said.