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What are some issues to be considered for exporting?

TH flag
Market Penetration Strategy
Aug 4, 2022
Edited By
Seujin Jang
Aug 4, 2022
Edited By
Seujin Jang
The issues that need to be considered before exporting Thai cassava starch are the government floor prices, logistics issues, very saturated market as well as climate change.

-Government Floor Prices: The Thai government tends to impose export floor pricing on cassava starch and chips as a way to increase the income of small scale farmers. Recent figures are $480/ ton (from $475) and domestic wholesale from 13.5 to 13.6 baht.

-Logistics Issue: Container shortage has increased the logistic cost up to 300%. At the moment sea shipments are kept to a minimum.

-Very saturated market: Players in the industry have increased exponentially. Competition is increasing and competitive pricing once an advantage has levelled the playing field. This can be an opportunity as well.

-Climate Change: Cassava plant is a hardy croup that can withstand low moisture and nutrient poor soil but this strength is now becoming a weakness face with climate change, as Thailand experience record floods and rains, The roots becomes waterlogged and rot, which greatly reduce harvest volume. As many of the farmers are small scale, without any government subsidy, they do not have much incentive to pay more to save rotting crops.

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