Thai livestock producers should adopt a more pro-active stance to ensure that they can withstand future risks, steeper hurdles and higher operating costs, according Somkuan Choowatanapakorn, COO pork business, Charoen Pokphand Foods Plc.
Before expanding their operations, producers must invest in environmental management strategies to ensure that they will be able to comply with more stringent environmental regulations. Neglecting to do so could result in greater risk of exposure to contagious diseases and end up provoking hostile sentiments from nearby communities.
Higher land costs, rising wages, volatility in feedstuff prices and unpredictable availability, as well as trade barriers, are making the livestock business more and more difficult and complicated, he added.
As a result, small operators are unlikely to expand, and large producers are experiencing resistance from local communities. At any rate, unbridled expansion can lead to oversupply and price instability, said Mr Somkuan.
Producers need to incorporate technology and automation to overcome labour issues. Other proactive steps might include looking into building supply chain partnerships with suppliers in neighboring countries or exploring offshore investment opportunities.
Collaboration could improve the fortunes of smaller farms, he added. For example, forming agricultural cooperatives or business entities gives groups more power to negotiate with suppliers or access capital from financial institutions.
Prices should be driven by market forces, he said. For its part, the public sector should provide appropriate land use planning rules that would optimize and demarcate land for for agriculture and livestock production.
Also, the government needs to continue to invest in research and development, particularly in disease prevention, new technologies to improve productivity, access to new markets and sources of investment capital.