Mcdonalds Thailand to source all its potatoes from US farms as Thai market demand on rise

BANGKOK: The United States Potato Board (USPB) recently splashed US$50,000 (about THB1.7 million) on a media fam trip for half a dozen Thai “journalists” to visit potato farms, as well as production and research facilities in Oregon, California and Washington.

According to a news release, the trip, aimed at bolstering the American potato trade in key foreign markets, correlates with a decision by the franchise holder of Mcdonalds restaurants in Thailand – McThai Co Ltd – to switch entirely to American potato suppliers, presumably from domestic suppliers.

Photo: http://wanderlustfullife.com/2012/01/12/an-immersion-in-thai-consumer-behavior/
McDonalds in Thailand will be sourcing its potatoes entirely from the US. Photo: Tourists pose in front of a Thai Ronald McDonald statue by http://wanderlustfullife.com/2012/01/12/an-immersion-in-thai-consumer-behavior/

 

The report highlights that:

U.S. potato product exports to Thailand have been growing. During the marketing year ending on July 1, 2015 … Thailand purchased 10,797 metric tons of frozen U.S. potato products, valued at $11 million [388 billion THB]. Though precise numbers about purchasing by McDonald’s Thailand are proprietary … the company is a “major player in the market.”

In addition to the three west coast states, Thailand also sources American potatoes from the states of Idaho, Colorado,  Wyoming, Montana, Nebraska, North Dakota, Wisconsin, Michigan, Minnesota, Maine and New York.

Thailand is Southeast Asia’s largest grower of potatoes, with farms supplying major producers of popular potato chips, including Lays, Pringles and Tasto, who serve both the domestic and regional (Asean) market.

In Thailand, potato chip products command a majority share of the snacks market, though competition from corn snack has notably grown in recent years.

Likewise, as Thailand GDP increases and the kingdom becomes more “industrialized” and “developed”, the fast food business continues to be a huge growth market, with American brands leading the way.

Thai farmers are increasingly lured to the potato trade with one rai of land (1,600 square meters or about .4 acre) providing yields that provide income of anywhere from THB15,000 to B25,000 ($425-$708).

However, the demand for seed potatoes in the kingdom has stripped supply, while farmers struggle to optimize yields due to certain viruses and bacteria, forcing the country to open up its import market.

The WTO has stipulated for Thailand to eliminate tariffs for a certain quota of potatoes for three years, from 2015 to 2017.

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