Pepsi-Cola (Thai) Trading Co (PepsiCo), the producer and distributor of Lay's potato chips, continues to improve agricultural productivity for its 5,800 contract farmers, aiming to increase revenue by 15% for 35% of those farmers by 2030.
Sudipto Mozumdar, general manager of Indochina Foods and chief commercial officer for Asia-Pacific, said climate change and rising fertiliser prices driven by inflation posed a significant threat to farmers.
"We use artificial intelligence to analyse data collected by drones that scout farms, check plantation areas, detect pests and evaluate plant diseases, which can help farmers promptly prevent or solve agricultural problems," he said.
Scouting drones can cover larger areas in a shorter period and require less labour, replacing manual monitoring which demands more manpower and time, said Surivassa Sattarujawong, the company's corporate affairs director for Thailand and Vietnam.
With these digital tools, along with infrared technology to inspect soil health and the installation of drip irrigation systems, potato yields at 19 demonstration farms in five northern provinces under the company's contract have increased from 2 tonnes per rai to 3.2 tonnes per rai.
The higher agricultural production, the more revenue farmers will get, said Mr Mozumdar.
The company uses more than 5,800 contract farmers, covering 38,000 rai across 10 upper northern and upper northeastern provinces.
These regions have temperatures ranging 24-26°C during the day and 14-18°C at night, making them suitable for cultivating potatoes.
"We aim to increase the revenue of 2,030 contract farmers, which represents 35% of them, by 15% by 2030," he said.
The 5,800 contract farmers collectively produce around 100,000 tonnes of potatoes annually, generating a combined revenue of 1.5 billion baht per year.
During the dry season this year, PepsiCo harvested a total of 72,400 tonnes of potatoes and expects to reach 94,000 tonnes by year-end. The remainder was from imports.
This production accounts for more than 70% of the total potatoes it uses to make potato chips.
According to market research firm NielsenIQ, the total market value of potato chips in Thailand was 14 billion baht in 2023.
"We have three issues we want the government to help farmers with," said Mr Mozumdar. "The Agricultural Ministry should consolidate land banks into larger sizes to maximise the use of agricultural technology."
The other issues are providing incentives, loans and funds for farmers to experiment with new methods, as well as improving infrastructure such as roads to facilitate the transportation of potatoes, particularly from highland areas.