Adverse Weather Shortens Thailand’s Longan Season and Impacts Trade

According to Top Jaidech, Tridge Origination Manager in Thailand, unfavorable weather conditions in the form of heavy rainfall in July and August 2022 shortened the fresh longan season in Thailand and affected the quality of the fruits. In the northern part of Chiangmai and Lamphun, prices jumped in W1 of August 22 amid lower quantities of fresh longan on the market and hovered around USD 12.8/11.5 kg box. Most of the production of fresh longan in Thailand is concentrated in the northern part of the country, which is the most affected by the adverse weather. Due to heavy rains, the fruits ripened earlier, and on W1 September 22, exports to the US stopped due to insufficient quantities and poor quality. Due to the unfavorable situation in the north, Thai traders will have to rely on suppliers from the eastern part of the country.

Symptoms of Fungal Diseases on Longan Fruits

The heavy rains that shorten the fresh longan season were not the only factor affecting the quality of the fruits. Excessive rain made it impossible for farmers to carry out necessary protection measures, which paved the way for diseases and pests. Golden flies and mold infestation damaged fruits that were not treated, causing a decline and deterioration of fruit quality.

Source: Tridge

The Chinese market takes the largest share of fresh longan exports from Thailand with 87.17% participation and a total value of USD 329.61M in 2021. Exports to China have experienced significant growth in the past five years, by as much as 918.03%. The harvested area under longan increased by over 284% to 187,564 ha since 1997. More on price trends for fresh longan in China here.

Although the US represented a 4.28% share of Thailand's longan exports, with a total value of USD 16.19M in 2021, decreased harvest will risk exports to the US, and the US will have to seek alternative suppliers. Looking at the past five years, Thailand's fresh longan export value to the US has decreased by 7.3%. Still, the US will remain an important market for Thailand traders due to steady demand and the high purchasing power of consumers.

According to Agung Sugiarto, Tridge Origination Manager in Indonesia, major importers in Indonesia in August were trying to fulfill their remaining quota until the end of the year and have turned to imports from Thailand as a backup. In Indonesia, longan prices in W2 of August 22 have surged from USD 11 to USD 14 per basket, a 27.27% WoW per basket of gold standard longan, and from USD 9 to USD 12 per basket of red longan, a 33.33% WoW increase. Indonesian importers are struggling to fulfill local demand as local supply and supply from Thailand are low.

Longan Fruit Ready for Export and Longan Fruit Tree Source: Tridge Om Top Jaideh

Longan crops from farms in the eastern part of Thailand are gradually getting ready for exports. In Eastern Thailand, the assortment of longan diameter sizes stands at 15% gold, 20% red, 30% blue, 30% green, and 5% orange. The demand for Thai longan for export is primarily gold and red, and producers look forward to the W4 of September 22, when more supply will be available. Nevertheless, the price outlook for longan fruit is expected to remain high due to the lower quantities available. The quantities of fresh longan coming from the eastern part of Thailand will not be enough to satisfy demand from China, the US, and Indonesia.