Thailand Food & Drink Report Q3 2013 - New Market Research Report

We expect further appreciatory pressure on the Thai baht, which will negatively impact the country's exports over the course of the current year. In fact, according to April 2013 statements made by Thailand's commerce minister, Boonsong Teriyapirom, the country's exports may fall to less than 5%, which would have a significant bearing on the wider economic trajectory. Nevertheless, imported goods will become more affordable, especially as we continue to believe that consumer price inflation will remain benign though 2013. In the meantime, the mass grocery retail marketplace continues to consolidate, with Charoen Pokphand Group acquiring Siam Makro in one of the largest acquisitions to date as it continues its push into the Southeast Asian market.

Headline Industry Data (local currency)

* 2013 per capita food consumption value growth = +7.03% year-on-year (y-o-y); compound annual growth rate (CAGR) to 2017 = +5.99%
* 2013 soft drinks value sales growth = +10.40% y-o-y; CAGR forecast to 2017 = +8.00%
* 2013 alcoholic drinks value sales growth = +6.32% y-o-y; CAGR forecast to 2017 = +5.52%
* 2013 mass grocery retail sales growth = +9.17% y-o-y; CAGR forecast to 2017 = +7.14%

Full Report Details at
- http://www.fastmr.com/prod/664935_thailand_food_drink_report_q3_2013.aspx?afid=301

Key Industry Trends

Rice Exports Continue To Slide: In April 2013, it was reported that exports of Thai rice dropped by more than half since June 2011, when exports stood at 1.1mn tonnes. Currently, Thailand exports less than 500,000 tonnes of rice, according to the Thai Rice Exporters Association. In the meantime, rice exporters are buying and selling at least 300,000 metric tonnes of rice each month from other Asian countries to combat the domestic shortage, which has been attributed to the government's policy of buying rice at abovemarket rates in order to increase the incomes of farmers.

Black Ivory Coffee Seeking Microbrewer In Japan: Thailand-based Black Ivory Coffee (BIC) is seeking a microbrewer in Japan to licence a beer made using the company's coffee, which is produced using Thai arabica beans, reported Beverage Daily in May 2013. A small batch of beer made using the company's coffee was launched in Japan in late April, although it was reportedly produced without BIC's permission.

Mass Grocery Retail Players Continue To Invest In Thailand: In line with our view that UK major Tesco will continue to expand in Thailand, in March 2013 it was reported that the retailer launched an online shopping platform. Similarly, Tesco is seeing positive results from its shopping centre retail strategy in Thailand, becoming the second largest shopping centre operator in the country. Other retailers are investing in new business areas, with Thailand-based Central Retail Corporation reportedly beginning trials of its pilot project to operate cash-and-carry stores in May 2013.

Risks to Forecasts

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