Thailand is banking on the continued growth of their pet food exports to help shore up their economy in 2021 against the pandemic doldrums.
Pet food exports to grow
The Ministry of Commerce’s Trade Policy and Strategy Office expects the exports of pet food, along with canned goods, rice, computers and medical products to combat COVID-19 to grow and help the country's exports gain 4% in 2021 after a contraction of up to 7% in 2020 largely due to the pandemic. With that drop, Thailand's 2020 exports totaled US$238 billion.
Pimchanok Vonkorpon, the office’s director-general, is hopeful that growth is achievable if their nearest trading partners (Cambodia, Laos, Myanmar and Vietnam) also steadily recover in 2021, if COVID-19 vaccines become widely available and if Thailand can further expand its market share in the U.S., China, Germany, Japan and the UK.
The Commerce Ministry reported that for the first 11 months of 2020, Thailand's pet food exports managed to expand up to 24% and were particularly strong in the first quarter of 2020 at US$466 million, which was 10% more year-on-year, with dog and cat food representing 81% of the total.
In 2019, Thailand exported US$1.693 billion worth of pet food, making it the world's fourth-largest pet food exporter after the United States, the European Union and China. Thailand's Department of Trade Negotiations said the country's pet food exports have risen 4% year-on-year ever since its ASEAN neighbors and countries like China, Australia, New Zealand, Chile, Peru and Hong Kong removed import tariffs as part of free trade agreements.
In the coming months, Vonkorpon said Thailand exporters will also be best served by the country's membership in the Regional Comprehensive Economic Partnership, a free trade agreement among the Asia-Pacific nations of Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand and Vietnam.
The pet food business' pandemic-buster performance is also reflected in the financial bottom line of Thai Union Group PCL, whose pet care division along with its other value-added business registered 12% growth during the third quarter of 2020, which translates to US$172.18 million in sales.