Thailand: new factory to kill one million more birds per week

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http://www.meatandpoultryonline.com/read/sp20011219/480532

Firm to Build Poultry Production Plant in Thailand

12/15/2001 

 

Dec 15, 2001 (Bangkok Post - Knight Ridder/Tribune Business News via COMTEX)

-- The bright prospects for chicken meat exports and increased market

competition have driven Charoen Pokphand Foods Plc (CPF) to commit four

billion baht to build a new poultry production base in northeastern

Thailand.

 

Claimed to be the first of its kind and one of the most modern poultry

production bases in Asia, the integrated chicken complex will be located on

a 1,000-rai site in Pak Thong Chai district of Nakhon Ratchasima, 250 km

from Bangkok.

 

The complex would cover all activities relating to the processing of chicken

beginning with farming, animal feed manufacture, the slaughterhouse and

processing plant, said Adirek Sripratak, senior executive vice-president.

 

The 18-month project will start next year with the first phase worth 2.5

billion baht and the balance of the investment to be made later in 2003.

 

When completed, the new facility will process one million chickens a week,

in addition to the three million slaughtered at CPF plants in Sara Buri

province and in Bangkok's Min Buri district.

 

The local industry processes about 18 million chickens a week, exporting 12

million.

 

The investment would help increase CPF's share of the country's chicken

exports to 35 percent by 2003, up from the current level of 30 percent of

the 400,000 tons of chicken exported by Thailand this year, according to

Teerasak Urunanon, CPF's senior vice-president overseeing the project.

 

The new complex will feature high technology to improve cost-savings and

food sanitation.

 

" The automatic machines will apply to many production stages such as pulling

out chicken giblets, instead of using workers' hands, " said Mr Teerasak.

 

Automation, widely used in poultry plants in Europe and Asia, would help CPF

cut labour costs and raise the quality standard of the meat processing, he

said.

 

" Market competition forces us to go farther than other local exporters, " Mr

Teerasak said.

 

He said the boom in chicken exports this year was another factor behind the

investment.

 

The new investment is forecast to lift CPF's sales revenue to 77 billion

baht next year, a 10 percent increase on this year.

 

Thailand will earn about 30 billion baht this year from chicken exports.

" This the best result for the past 30 years, " said Mr Adirek.

 

He said the Thai poultry business had gained from the outbreak of mad cow

and bird-flu diseases that had decimated the meat industries of many

countries.

 

The price of chicken exports from Thailand has doubled in the main markets,

to US$2,200-$2,300 a ton for leg meat, compared with $1,100 to 1,200 last

year.

 

The attacks in the United States have affected the company's business only

slightly, especially the export of prawns in the first nine months.

 

Thailand exported 189,911 tons of prawns, worth 75 billion baht, from

January to September this year, compared with 180,822 tons, worth 74 billion

baht, year-on-year.

 

An analyst from SCB Securities Co said the fundamentals of CPF were sound

while the company had continuity in future investments related to its core

business.

 

He said sufficient reserves has enabled the company to expand investment

without borrowing from outside sources.

 

The company has six billion baht in cashflow with a low debt-equity ratio,

at 1:1.

 

The analyst said good export prices, especially in Japan, had benefited the

firm and he expected CPF to pay a 10 percent dividend yield this year, a

rate rarely found in stocks in the market today.

 

CPF decided to pay quarterly dividends to shareholders, beginning last year.

A total of 0.43 baht a share of five baht par value has been paid during the

first three quarters this year.

 

Mr Adirek said that since the change in dividend policy, CPF shares had

attracted interest from Thai investors, who currently numbered about 7,000,

compared with 1,700 in 1999. CPF is also planning a roadshow to promote its

stocks in major markets such as Japan, Europe and the United States. CPF

shares closed yesterday at 5.40 baht, up 20 satang, in heavy trade worth

195.1 million baht.

 

--By Walailak Keeratipipatpong and Phusadee Arunmas

 

To see more of the Bangkok Post, or to to the newspaper, go to

http://www.bangkokpost.com

 

© 2001, Bangkok Post, Thailand. Distributed by Knight Ridder/Tribune

Business News.