Fruit prices rise in drought

Thai fruit prices are set to surge because the prolonged drought has drastically cut production, particularly in the eastern provinces.

Production of key fruits such as durian, mangosteen and rambutan is expected to drop by 20% this year from about 700,000 tonnes last year, commerce permanent secretary Chutima Bunyapraphasara said.

Rambutan production is estimated at only 175,000 tonnes this year, down 18.6%, with mangosteen down 3.7% to 110,000 tonnes and durian down 6.38% to 316,000 tonnes.

Ms Chutima said fruit prices had significantly increased. For instance, export-grade durian is now quoted at 100-120 baht per kilogramme compared with only 45 baht last year.

In the first three months of this year, Thailand shipped 238.8 million tonnes of fruit to foreign markets.

Higher prices were also partially due to stiffer competition in the domestic market after foreign fruit traders dealt directly with farmers, handling their own exports rather than going through Thai brokers.

In a move to tackle the influx of foreign traders, mainly from China, the Commerce Ministry in March launched the “Chanthaburi model”.

Chinese traders who want to buy fruit directly from farmers in Chanthaburi province are required to register with the Agriculture Department. The produce they buy must pass good agricultural practice standards, while the purchase contract must be conducted in a manner fair to farmers.

Although entry by Chinese traders creates more competition among middlemen and brokers, ultimately benefiting farmers, authorities fear that in the long term the practice could hurt farmers and small businesses if Chinese traders corner the market.

Authorities also vowed to regulate foreign fruit importers and distributors after it was discovered they are selling their goods in Thailand’s fresh fruit and vegetable wholesale markets.

These include Talaad Thai, Si Mum Muang market, Iyara market and Srimuang market.

Foreign traders are taking produce from China and Vietnam and bringing it to Thailand, mostly via the Chiang Khong border checkpoint in Chiang Rai province, and the border checkpoints at Nakhon Phanom, Nong Khai and Mukdahan. They often transport produce on the R3A highway.