Thai maker of ‘Chicken of the Sea’ plays down US trade move

BANGKOK: Thai Union Group Pcl, producer of the ‘Chicken of the Sea’ canned tuna brand, doesn’t expect a major impact from the US decision to scrap some trade preferences for Thailand.

The US last week revoked the eligibility of Thai seafood products for the so-called generalized system of preferences.

Thai Union said none of its seafood or pet food products sold into the US from Thailand are in the programme.

“At this time, I do not foresee this decision by USTR as having an impact on our business,” Thai Union’s chief executive officer Thiraphong Chansiri said in a statement Sunday, referring to the Office of the US Trade Representative.

Apart from the action against seafood products, the US said last Friday it will also suspend Us$1.3bil of benefits that allow dutyfree access for other Thai exports.

The Asian nation played down the implications, saying it would cut total annual shipment value by at most Us$32.8mil in 2020.

The US is Thailand’s second-largest export market, and shipments were worth Us$31.9bil last year, data compiled by Bloomberg show.

Canned tuna doesn’t qualify for the generalised system of preferences, a Thai Union spokeswoman said, adding the firm didn’t seek the benefit for any products that were eligible.

The Office of the US Trade Representative said its decisions were triggered by concerns over workers’ rights, which it said have been a “longstanding” problem in Thailand’s seafood and shipping industries.

Thai Union, one of the world’s biggest canned-tuna producers, said it’s committed to working with governments around the

At this time, I do not foresee this decision by USTR as having an impact on our business.

Thai Union CEO

world to improve such rights in global supply chains.

Thailand has been criticised for illegal, unreported and unregulated fishing as well as forced labor on boats, which prompted the government to tighten rules from 2015.

The generalised system of preferences provides preferential duty-free treatment for thousands of products to bolster the economies of developing nations, according to the Office of the US Trade Representative.

The US and Europe are Thai Union’s most important markets, accounting for about 38% and 30% of sales respectively.

The John West tuna brand is among its best known in Europe.

The Bangkok-based firm has been buffeted by Thailand’s surging currency, the baht, whose appreciation is taking a toll on the revenue outlook.

At the same time, bigger tuna catches are helping to curb costs.

The baht’s strength has hurt investor sentiment toward Thai Union’s shares, which are down almost 14% this year, compared with a 2% climb in the benchmark SET index of equities.