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Thai Feed Industry To See 10% Growth This Year

Published on 23 February, 2006, Last updated at 23:01 GMT

23rd Feb, 2006: BANGKOK - Thailand's feed industry will be buoyant this year with growth around 10%, catching up with an increase in the livestock population, the president of the Thai Feed Mill Association said.

"The number of major (feed meal) eaters - both chickens and swine - is expected to increase significantly. The Thai feed industry, thus, will grow around 10% this year," Virachai Ratanabanchuen told Dow Jones Newswires in a recent interview.

The 10% growth is expected in both feed production and consumption, Virachai said.

Last year, land animal feed production totaled between 9 million and 10 million metric tons, he said.

Land animal feed consumption totaled around 9.7 million tons in 2005, an official at the Thai Feed Mill Association said.

Virachai said chicken-raising will be almost back on track this year after suffering a slowdown during the first outbreak of bird flu here in 2004 and struggling to recover in 2005.

"We expect the chick population to escalate to around 19 million chicks a week, from around 16 million chicks/week late last year and from the lowest number of 7 million to 8 million chicks/week when the bird flu outbreak was at its worst in 2004," Virachai said.

Prior to the bird flu outbreak, Thailand, among the world's top five chicken exporters, produced between 22 million and 23 million birds a week.

While many importing countries banned raw poultry imports from Thailand, major importers including the European Union and Japan accepted Thai cooked chicken imports.

Thailand's Ministry of Agriculture and Cooperatives forecasts that chicken exports, mostly cooked chicken, in 2006 will rise to around 400,000 tons from an estimated 270,000 tons in 2005.

"Export markets will be brighter this year while domestic chicken markets aren't worrisome. Feed consumption will increase accordingly," Virachai said.

The swine population is also expected to rise, adding support to the feed industry, Virachai said.

Prices of live pigs have been rising in the past two years as bird flu worries boosted demand for pork as an alternative to poultry, he said.

Live swine prices are now around THB50-THB52/kilogram, compared with around THB46-THB48/kg through much of last year, Virachai said.

While chicken production will grow, swine production is expected to stay strong too because of high pig prices, Virachai said, adding that the pig population will rise to 11 million pigs in 2006 from around 10 million last year.

Corn Output To Rise On Recent Rain

Despite expected growth in feed production, corn imports are unlikely to rise accordingly, Virachai said.

An expected expansion in the domestic corn crop this year will make corn availability sufficient for increased feed production, he said.

Thailand imported 58,626 tons of corn worth THB148 million in 2005, down from 75,754 tons worth THB212 million a year earlier, data from the Ministry of Agriculture and Cooperatives shows.

Corn is the main ingredient in poultry feed, constituting around 50% of the raw material.

"Late rains in November and December, through January for some areas, will help boost corn production this year after drought slashed output last year," Virachai said.

In 2005, Thai corn production fell around 10% from the previous crop to total 3.9 million tons, according to data from the Ministry of Agriculture and Cooperatives.

"I expect corn production will rise to around 4.2 million tons this year," Virachai said.

Higher production will encourage a rise in corn exports in 2006, but export growth will be limited as healthier domestic demand will absorb most of the surplus, Virachai said.

Thailand is forecast to export around 60,000 tons worth THB350 million of corn in 2006, up from 58,662 tons worth THB348 million a year ago, according to the Ministry of Agriculture and Cooperatives.


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