CPF confident of 15% growth target despite labour issue
Charoen Pokphand Foods says it is confident that sales will grow by a strong 15 per cent this year, especially after it makes it clear to buyers that it does not condone the use of illegal labour and denounces slavery.
Adirek Sripratak, president and chief executive officer of CPF, said the company was stepping forward to provide its trading partners overseas with better understanding of the situation. Its principles on labour have been announced clearly. The company has stopped purchasing fishmeal from producers that lack certification to prove their practices are lawful.
“CPF has no fishing boats and has no fish mills. We are the only fishmeal buyers and [do this] the right way,” he said.
He acknowledged that inappropriate use of labour on fishing boats and the purchase of fishmeal from certain producers had an indirect impact of CPF’s supply chain. But all relevant government agencies and associations are well informed on this issue and are acting urgently to wipe out the problem of labour abuses.
The suspension of orders by trading partners in the United States and European Union had only a small impact. CPF has more than 100 buyers in the US with a combined annual import value of Bt4 billion. Of that total, only one supermarket suspended orders valued at Bt600 million per year – not much compared with CPF’s total revenue of Bt400 billion last year. Sales in EU markets saw an even lower impact.
Adirek stressed that the company’s trading partners overseas now had a better understanding of the situation in Thailand and were placing orders again. For instance, Carrefour supermarkets in some European countries have resumed orders with the company after learning more of the actual facts. In addition, Tesco in Britain has maintained orders with CPF.
CPF has processing plants in 13 countries that focus on their own domestic markets, and their sales account for 93 per cent of the company’s total. Export value accounts for only 7 per cent. Therefore, the impact from the labour problem amounts to less than 0.002 per cent of total sales revenue.
The company still believes it will achieve its projected business growth.
