Kingdom to be Asean centre for Terragro production, export

 
  The company, owned by liquor tycoon Charoen Sirivadhanabhakdi’s TCC Group, targets export of at least 30,000 tonnes of fertiliser under its Crown brand to neighbouring countries, mainly Cambodia, this year.
Managing director Vuttipong Vungsuntitum said the company projected sales of 500,000 tonnes, both domestic and export to other Asean countries, which is 25 per cent more than last year.
“Asean, which is a fast-growing economy, should serve as a bright market for chemical-fertiliser trading in the long run, since the region has plenty of farming areas and is considered a base of agricultural production to supply the world market,” Vuttipong said.
The company expects to drive export volume to 100,000 tonnes in Asean countries next year.
Of all Asean nations, Cambodia has the highest potential for export, since it has more than 550,000 rai (88,000 hectares) of palm plantation. It has the capacity to use up to 1.5 million tonnes of chemical fertiliser, but currently imports only 500,000 tonnes a year.
Laos has the second-highest potential with plantation of about 100,000 rai for sugar cane and coffee. Burma is also a future targeted market for Terragro’s fertiliser export, since many new investors are looking at expanding their crop plantation there after the opening of the country.
Vuttipong said that under the Asean Economic Community, which will allow free flow of goods, Thailand would be the company’s centre for production and distribution to Asean countries. Terragro may consider setting up a packaging plant in Cambodia in the future if the size of the market increases significantly. However, since setting up of a production plant for chemical fertiliser would cost a lot of money, Thailand will continue to be the production centre.
To increase the efficiency of the firm and serve the rapid growth of sales, it has invested Bt150 million to expand its warehouses and increase production capacity through automation this year. Previously, its plant had a capacity of 1,000 tonnes a day. The new automated plant will boost daily production capacity to 2,500 tonnes.
To increase domestic sales and market share, Terragro will also spend Bt129 million for advertising and promoting its products this year. The company aims to become the country’s fourth-largest chemical-fertiliser producer this year, with its market share increasing from 8 per cent in 2011 to 10 per cent. At present, Chia Tai is market leader with a 22-per-cent share, followed by Thai Central Chemical at 18 per cent, Pravit Group at 11 per cent, and ICP at 9 per cent.
Terragro forecasts that the price of chemical fertiliser will fluctuate in the next few months because of the impact of Western trade sanctions on Iran and rising fuel prices in the world market. However, the price is expected to drop slightly in the second half of the year on greater supply from new urea-production facilities in Qatar, Pakistan and China.
The price of urea fertiliser, currently Bt15,300 per tonne, is expected to fall to Bt15,000 in the second half.