Coconuts unfazed by export hit
Two coconut milk manufacturers, Theppadungporn Coconut Co and Asiatic Agro Industry Co, will continue to expand their businesses even as exports are hit by the stronger baht.
Aphisak Theppadungporn, managing director of Theppadungporn Coconut, said the stronger baht has affected its coconut milk and coconut water exports because export contributes 80% of the company’s total sales, with the rest coming from domestic sales.
The company will increase its overseas coconut milk and coconut water prices by 5%.
The US makes up 50% of the companies’ export market, followed by Canada at 15%, Australia 15% and the remaining 20% to other markets.
The baht yesterday was 34.04 baht a US dollar, strengthening from 35.80 baht a US dollar in March.
“We’d like to call on the government to manage the exchange rate and stabilise the baht to around 35 baht per US dollar,” Mr Aphisak said.
Despite the stronger baht, the company will continue to expand business by investing 100 million baht to install new machines at its factory on Phuttamonthon Sai 4 Road.
Another 100 million baht will be allocated to marketing activities to promote products both domestically and overseas.
Yesterday, the company introduced a new coconut drinking milk and seafood sauce in PET bottles.
This year, sales are expected to be maintained at 6.3 billion baht due to the shortage of coconuts in Thailand.
“This is the most serious coconut shortage since we established our business 42 years ago, because the coconut plantation area has declined to 1.1 million rai from 1.8 million rai in the past,” he said.
To cope with this problem, the company is importing coconuts from Indonesia and Vietnam and has put more effort into launching new products to boost sales.
Moreover, it bought a 200-rai plot to plant coconut by itself and expects to yield in the next 4-5 years.
“We also want the government to promote gardeners to plant more coconut as they will earn more than growing rice,” he said.
Meanwhile, Nutapon Visuthikraisee, managing direct of Asiatic Agro Industry Co, the producer of Ampawa coconut water and milk, said the company plans to spend 2 billion baht to build a new factory on 60 rai in Amphawa district, Samut Songkram.
The company plans to increase the production capacity of its coconut products to 12,000 containers per year from 4,000 containers.
This is to support the future growth of its coconut water and other coconut products in overseas and domestic markets.
“Thailand’s coconut products get a warm welcome from customers overseas. We are optimistic about the future of our Cocomax coconut water,” Mr Natapon said.
Apart from coconut water, the company plans to diversify into coconut-related products this year, including coconut cooking oil.
Last year, Asiatic’s sales stood at 2.4 billion baht and are expected to rise to 4 billion baht this year.
About 70% of its sales projection this year will come from exports, making the impact of the stronger baht inevitable. To cope with this, Asiatic has purchased exchange rates in advance to reduce fluctuation risks.
It will also import coconuts from Indonesia from November to March, when the 54% import tax is not charged.