Thailand is an interesting market for Australian companies; the growing food and beverage sector, combined with increasing incomes is raising interest in imported, packaged and healthy foods. Here are some of the major trends.
A growing market sector. The food and beverage market in Thailand is a burgeoning sector, with the market value increasing by nearly 7% per year. Food categories performing particularly well include dairy products, wine and beer, nuts, fresh vegetables, seafood, beef, and bread and cakes.
Increasing incomes fuel interest. Thailand is now home to around 30 million consumers whose incomes fall in the middle / upper bracket. From these incomes, about 35% of Thai household budgets are spent on food and drink.
Key product categories are seeing healthy gains. Some types of products are out-performing the 7% increase seen across the sector. Cold premium beverages are predicted to see a 15-18% increase in their market size over the next 3 years, while biscuits are growing at a rate of 8-9% per year. Products that consumers categorise as indulgences or experiences have strongly growing popularity.
Retail options are evolving. Like many SE Asian countries, Thailand’s grocery retail has traditionally been dominated by fresh food markets and small retailers. However, supermarkets and hypermarkets are a growing retail sector, with packaged goods and convenience products starting to challenge the supremacy of fresh food. Up to 90% of Thailand’s city-living population shop at a hypermarket at least once a week.
Convenience is king. Convenience stores are a huge retail sector in the food and beverage market. There are over 12,000 stores in a fiercely competitive market.
Urbanisation and global influences are changing diets. With urbanisation, an increasing range of retail options, and wider availability of imported and pre-packaged food, Thai diets are also changing. Although rice, vegetables and fish remain staples, consumers are increasingly demanding convenient and premium products.
Organic and health foods are a growing trend. Younger consumers with higher disposable incomes are looking for high quality, healthy foods. As a result, the organic food sector grew by over 10% per year between 2008 and 2012, while health foods grew by 7-15%.
The food services sector is developing. 70% of Thailand’s food spending comes in the retail sector. However, youthful, urbanised consumers are also increasingly eating out for the experience or convenience. An estimated 30-35% of food products used in this sector are imported.
As is demand for ingredients. Thailand has one of SE Asia’s most extensive food processing industries, and this forms a major market for imported goods and ingredients. In 2017, the market value of ingredients imported into this sector grew by 16%.
Free trade agreements are in place. Australia enjoys a good trade relationship with Thailand via a direct Thailand – Australia trade agreement and the ASEAN-New Zealand-Australia trade agreement.
If Thailand sounds a tempting market, why not get in touch with us to have a deeper discussion? At Export Connect we love to hear from you.
