In Thailand, the longan industry, a key agricultural export, is facing challenges due to its heavy reliance on the Chinese market. Approximately 95% of China's longan supply, valued at U.S. $400 million, originates from Thailand, as reported by the Thai Ministry of Commerce. This dependency has given Chinese middlemen considerable control over the pricing of Thailand's longan exports, affecting the local industry's stability.
Chinese merchants, who have been involved in the Thai longan market since around 2012, now control a significant portion of the trade. Their influence extends beyond longan to other fruits, notably durian, where Chinese interests command about 70% of the Thai wholesale and logistics sector. This involvement has led to a diminished bargaining power for Thai farmers and an increased reliance on these middlemen, according to research from Li Jun Wang at Chiang Mai University and findings from the Office of Farmers' Reconstruction and Development Fund.
The situation has prompted calls for diversification and the exploration of new markets to reduce dependency on China. Rangsan Maneerat, an MP from Lamphun province, has proposed legislation aimed at addressing these challenges, highlighting the need for fair pricing, the development of value-added longan products, and the negotiation of new markets. Similarly, Donlawat Sunsuk from The Glocal has advocated for the development of new products and markets beyond China to ensure the industry's resilience.
Deputy Prime Minister Phumtham Wechayachai has acknowledged the need for the Thai government to address these issues promptly and effectively, emphasizing the importance of maintaining high standards to remain competitive globally. With Cambodia increasing its share in the Chinese longan market, the urgency for Thailand to adapt and innovate is clear.
Source: Benar News