Thai-Japanese long-term business partnerships come in handy in an emergency.
Photo above of a Betagro meat processing plant.
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Japanese step up meat orders: Business relationships benefiting Betagro by Walailak Keeratipipatpong
PHATTHALUNG : Japanese food traders and importers are placing more meat orders from Thailand in a bid to secure food supplies after last week's deadly earthquake and tsunami damaged cold-storage operations.
Opening the new Betagro pork processing plant in Phatthalung, from second left: Betagro Group chairman Chaivat Taepaisitphongse; Sakchai Sriboonsue, secretary-general of the National Bureau of Agricultural Commodity and Food Standards; and Phatthalung Governor Pisit Boonchuang.
Betagro, one of Thailand's top agricultural conglomerates, has received requests from several companies, some of which already have joint ventures with the group, for chicken and pork products, said chief operating officer Vasit Taepaisitphongse.
He said the purchases were aimed at ensuring local Japanese traders have enough meat for the normal reserve level of three or four months.
"The disaster has not only damaged food suppliers in northeastern Japan, but also disrupted cold-storage operations, and uncertainty remains as to when normal business can resume," said Mr Vasit.
He said the catastrophe would further lift the price of chicken, which has already edged up by 5-7% this year following production shortfalls in Brazil, the world's largest chicken supplier
Prices will see an upward trend on strong demand, and Japanese buyers realise this. But we're not going to take advantage of a bad situation," he said.
Betagro has had joint ventures with Japanese food companies for more than 30 years.
Betagro's export chicken prices are already high at US$7,000 to $8,000 a tonne due to the value-added nature of its products. This is more expensive than the average of $4,500 to $5,000 a tonne for exported Thai chicken meat.
The situation in Japan has not yet affected Betagro's exports, but shipments have been shifted from Tokyo and Yokohama to other ports such as Osaka.
More local food ventures with Japanese companies are expected for food security reasons.
Betagro has had joint ventures with Japanese corporations for more than 30 years in various meat products, mainly chicken and pork.
Sumitomo, Ajinomoto, Mitsubishi and Itoham are just a few of the partners, and Betagro welcomes new ones as long as the new operations do not affect existing ventures.
Japan is the company's largest export market for chicken, accounting for 60% of the 50,000 tonnes planned for shipment this year.
However, the new orders mean Betagro will have to raise its export proportion to Japan, which could affect European markets that share most of the remaining balance.
We might take some away from the domestic supply, for which we plan to slaughter 410,000 to 420,000 birds a day, up from 370,000 last year," said Mr Vasit.
The brighter export outlook will help to ensure the group meets this year's sales revenue target of 61 billion baht, up by 17.3% from last year.
Of that, 34 billion baht will come from Betagro's regional and animal feed operations, which have enjoyed significant growth in recent years.
Narongchai Srisantisaeng, the senior vice-president for the regional and feed business, said the company's performance in southern Thailand showed impressive growth last year, with sales revenue of 5.3 billion baht. This year's target for the South is 6 billion baht.
To this end, the group yesterday opened a new pork processing plant in Phatthalung province that can handle 240 pigs a day for regional distribution.
Pork consumption is high in the South thanks to tourism and an economy that is improving on strong prices for crops such as for natural rubber and palm oil.
Betagro has earmarked 400 million baht for southern investment this year including another pork processing plant and a chicken processing plant in Krabi province with daily capacity of 40,000 birds.
A new distribution centre and grading units are planned for its HyEgg brand.
The amount is part of this year's investment budget of 3 billion baht.
(Source: Bangkok Post, Japanese step up meat orders: Business relationships benefiting Betagro, 19/03/2011, Walailak Keeratipipatpong, link)
Betagro Group - major Thai agribusiness firm and producer of processed meat products (See website)
processed meat - meat that has been cut, packaged and turned into a product that can be sold in a store
food processing - the methods and techniques used to transform raw food ingredients into food (See Wikipedia)
agribusiness - a company with revenues from sales of agricultural products or sales to agricultural producers (See Wikipedia)
meat processing plants - a factory that "handles the slaughtering, processing and distribution of animals such as cattle, pigs, sheep and other livestock. The industry is primarily focused on producing meat for human consumption, but it also yields a variety of by-products including hides, feathers, dried blood, and, through the process of rendering, fat such as tallow and protein meals such as meat & bone meal" (From Wikipedia on meat packing industry)
pork processing plant - a "meat processing factory" for the meat of the pig (pork)
cold-storage - a very cold place where food is put to keep it fresh (refrigeration, freezers) (See Wikipedia on refrigeration)
emergency (noun) - an unexpected and dangerous situation that requires immediate action ภาวะฉุกเฉิน, ภาวะเร่งด่วน
come in handy - is useful (something useful that is where you are and can be used when you need it)
traders - people who trade securities (stocks, bonds) and derivatives ผู้ค้าหุ้นและหลักทรัพย์
bid - an attempt to do something ความพยายาม
secure - to get or achieve something important การได้มาซึ่ง, เพื่อเป็นประกันว่า
earthquake - a sudden shaking movement of the ground แผ่นดินไหว
storage - the putting and keeping of things in a special place for use in the future การเก็บ
conglomerates - a large company that owns many smaller companies doing different kinds of businesses
joint - done together; belonging to or shared between two or more ความร่วมมือกัน
joint ventures - when two or more companies own and operate a business together
officer - a high level person in an organisation with special responsibilities (a government officer, a police officer, an army officer)
chief operating officer - the highest level manager in a company
reserve - something currently not being used but that can be used when needed สำรองไว้
normal reserve level of three or four months - the extra amount that is kept for future use (just in case there is a problem and stocks run low)
disaster - something very bad that happens and causes a lot of damage or kills a lot of people ความหายนะ ภัยพิบัติ
disrupted - interrupted and prevented from continuing smoothly by creating problems ขัดขวาง
uncertainty remains - people still do not know completely what is happening
catastrophe - an event that causes a lot of damage and makes many people suffer (examples: tsunamis, earthquakes, fires, etc)
lift - increase
life the price - increase the price
edge up - increase by small amounts
shortfalls - when the supply is not enough
trend - a gradual change or development that produces a particular result ทิศทาง แนวโน้ม
demand - the need and desire to buy goods and services by households and businesses
realise - to know about ตระหนัก รู้
advantage - a condition giving a greater chance of success ความได้เปรียบ
take advantage - use a situation for your own benefit
value-added - the extra things that a company does to a good or product to make it more valuable (so that it can sell the product for more than the normal price, this could include special packaging, special quality assurances, ready to eat frozen meals, etc)
nature - the basic quality or feature of something ลักษณะที่แท้จริงของสิ่งต่างๆ, ธรรมชาติของสิ่งต่างๆ
ports - places next to the sea where ships can park (dock) and offload or upload goods to transport
expected - believe will happen คาดว่า (จะเกิดขึ้น)
security - the activity of making safe or protecting from harm
food security - food security - making sure that a country has enough food to eat under the future, even if there is bad weather, crop diseases, or war (this is part of government policy, if a country imported all of its food, a bad economy or war might cut off the supply of food (See Wikipedia)
corporations - a large company (registered with the government as separate legal entity, owned by many shareholders) (See Wikipedia)
partners - the companies owning part of the joint venture หุ้นส่วน
X as long as Y - X can happen if conditions Y continue
share - to have or use something at the same time as someone else ใช้ร่วมกัน
domestic - within the country ภายในประเทศ
outlook - what experts think will happen in the future อนาคตที่คาดไว้, ภาพรวม อนาคต
export outlook - what experts think the exports of a country will be in the future
ensure - to make certain that something happens or is done รับรอง ให้ความมั่นใจ
revenue - income from taxes or business activities รายได้
target - a goal เป้าหมาย
sales revenue target - the amount of money that a company plans to earn from sales of its products and services during a period
animal feed - food for animals
significant - large enough to be important or have an effect ที่สำคัญยิ่ง
performance - how well or badly something works or does (or whether an investment provides a reasonable return)
impressive - a great achievement that people admire and look up to, something that people admire because it is very good, very large or shows great skill ซึ่งน่าประทับใจ
distribution - giving, sending or delivering things to many people or stores การจำหน่ายออกไป (example: distribution of goods from the Lotus warehouse to its branch stores)
regional distribution - sending or delivering things within a whole region (here: ASEAN region which is larger than Thailand including, for example, Malaysia)
consumption - money spent by households and families on goods and services การบริโภค (See Wikipedia)
natural rubber - rubber from rubber trees, from nature, not chemically-made by humans (See Wikipedia on rubber)
synthetic rubber - a substitute for natural rubber with improved material properties, close to 21 million tons of rubber were produced in 2005 of which around 58% was synthetic (See Wikipedia)
earmarked - use for a special purpose or programme
investment - taking your money and putting it into projects to make a profit or earn interest (buying stock shares, bonds, real estate)
capacity - the amount of something that can be produced ความสามารถในการ (ผลิต)
grade (verb) - to separate things into different groups according to quality, size, importance etc
grading units - factories which check eggs and separate them into different groups based on quality and size
brand - a type of product made by a particular company ตรา, ยี่ห้อ
budget - the amounts of money that an organisation plans to spend on different things during the year (See Wikipedia) งบประมาณ
investment budget - the money that a company spends on investment each year (new businesses and projects in addition to replacing old equipment)
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