Sweet-corn producer takes value-addition route to growth

Chiang Mai-based Sunsweet had sales revenue of Bt1.5 billion last year of the Bt5-billion sweet-corn market in Thailand. The global market is worth Bt20 billion to Bt30 billion annually.
Ongart Kittikhunchai, founder and president of the company, said that unlike rice or rubber, which are hit by falling prices, sweet corn had lower risk from price volatility but had low margins.
“Being in the field of agriculture is not easy. Other crops such as rice and rubber are facing a bad situation because these crops were not developed. We might face the same situation if we are unable to improve ourselves. Therefore, we need to move forward the transformation model to secure sustainable long-term growth.”
He said the time had come for basic agriculture products to move into high-valued-added products and focus on being cost-efficient.
Ongart said 2015 would be the year of transformation of Sunsweet with a sales-revenue target of Bt5 billion for the next three years.
Sunsweet was established in 1997, producing canned sweet corn for 55 overseas markets, with Europe, Russia and Japan being the main ones. In 2012, the company set up a plant to produce frozen sweet corn, which Ongart noted was the first step by the company towards becoming an innovative sweet-corn producer.
Frozen sweet corn is one of three product lines at Sunsweet. Though this product contributes only 10 per cent of sales revenue, it is expected to become the focus in the near future amid high demand in the global market.
There are two factors playing a role in transforming production. The first is technology – the company is buying machines from Spain and elsewhere in the European Union to support frozen products – which has led to an increase in productivity. Sunsweet has its own biomass energy unit to supply electricity to its plants.
Second is the knowledge gathered from Maejo University in Chiang Mai on modern agricultural methods to support the company’s transformation.
This knowledge will help increase crop yield for Sunsweet’s contract sweet-corn farmers.
The company has offered a price guarantee of Bt4-Bt6 per kilogram to its 20,000 farmers to increase their confidence.
With the help of knowledge gathered from Maejo University, Sunsweet has developed a smart-farm project, along with the price-guarantee scheme.
Under the smart-farm project, farmers will have monthly incomes of at least Bt15,000.
Ongart noted that the smart farm would help reduce the problem of younger farmers who might not want to stay on because of low incomes. On average, sweet-corn yield per rai is around 1 to 1.3 tonnes but smart-farm technology will boost the yield to 3-4 tonnes per rai (18.75-25 tonnes per hectare).
He said that after making the transformation, the next target for Sunsweet was to move to producing food ingredients from sweet corn to reach out to health-conscious consumers.
Health products from agricultural crops will have high demand in the next few years with increasing numbers of health-conscious consumers and the rising number of elderly people in global markets, he said.
Sweet corn contains beta-carotene, which could be converted into an antioxidant.
Sunsweet’s research and development department is working on producing food ingredients and vitamins from sweet corn, he said.