THE BANK FOR AGRICULTURE and Agricultural Co-operatives has been building its troops of small agricultural businesses as it has worked to strengthen its lending ecosystem and help farmers.
Boonthieng Pruksakit, owner of a fruit processing factory, is an example of someone successful in a small agricultural business.
The owner of Chanthaburi Fruit Product Co, Boonthieng had struggled for many years while working to build trust with supermarkets and high-end consumers.
He started in business by growing his own fruit, then moved into the fruit processing business in 1996.
“I’m among the first to introduce freeze-dried technology for fruit processing in Thailand,” Boonthieng said with obvious pride.
His products are available at Tops, Big C, Food land, the Mall and Siam Paragon supermarkets targeting high-end consumers. Product champions include fried Durian chips and freeze-dried Durian. Orders now exceed his capacity to produce.
“I have to maintain a quality product, so it is hard to meet an increase in orders in just a short period of time,” he said. He now has about 30 product lines under both his own brands and produced for other brands.
Before succeeding with a continuously high-quality product, he failed many times and even had a non-performing loan at the Bank for Agriculture and Agricultural Co-operatives (BAAC).
He spent great efforts to learn how to choose the proper quality fruits that would maintain their good taste when processed.
Technology that allows for fruit processing at the right price is also very important factor, he said. Fortunately, there were local manufacturers who could produce a custom machine to his required standards for his factory.
Dependent on migrant labour
Another factor is labour. Most of his labourers are migrants from Cambodia and Myanmar. The factory runs seven days a week in order to meet demand for his products, which include processed durian, mangos, bananas, jack fruit, pineapples and mangosteens.
He said Chanthaburi is an ideal location for a food processing factory because it is close to raw materials, with the eastern provinces best knows as a fruit hub.
He also imports mango from Cambodia.
The challenge is how to get best quality for the right price, otherwise it could cost his investment, he |said.
Climate change has impacted on rainfall and is causing ups and downs in the availability of fruit supplies, he said. In recent years, unexpected heavy downpours are happening outside the rainy season and threaten to damage fruit yield, as fruit trees are forced to withstand the abnormal weather cycle, he said.
Another challenge is finding a market to sell his products. It took him many years before he could find good channels for delivering his products to consumers.
And now his son is busy to creating an e-commerce platform to sell products directly to customers, he said.
The BAAC in recent years has worked to nurture small and medium-sized agricultural enterprises.
In Chanthaburi alone, there are 181 such enterprises with combined loans worth Bt193 million, said Worapas Boonmun, director of Chanthaburi’s BAAC provincial office.
Nation-wide, the number of agricultural SMEs reaches 25,281 with combined loans worth Bt31.6 billion. They come in the form of individuals, local enterprises and private companies under the BAAC network.