Post on 01-Jan-2016
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CONTRACT FARMINGBUSINESS FOR DEVELOPMENT
“CHALLENGES AND OPPORTUNITIES”
MR. VICHAI POONPIRIYASUP
CROP INTEGRATION BUSINESSC.P. GROUP (THAILAND)
13 MARCH 2007
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1. ABOUT Charoen Pokphand (C.P.) GROUP1. ABOUT Charoen Pokphand (C.P.) GROUP
Total Trade Value 13 billion USD.
MISSION : C.P. is Source of Human Energy - Kitchen of the World - Food for Brain
Pattern of Business :Expansion along Vertical Integration lines
Two main Business Streamlines :• Production and Processing (Agri-business)• Service (Telecommunications Logistics and Retailing)
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Business Lines
3. THE CROP INTEGRATION GROUP
1. AGRI-FOODS BUSINESS GROUP ( Agro- Industry, Aquaculture Industry and Frozen Foods & Service)
5. INTERNATIONAL TRADING BUSINESS GROUP
2. CHIA TAI CO.,LTD. GROUP (Seeds, Fertilizers and Plant Protection)
4. THE PET BUSINESS GROUP (Pet Foods)
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Business Lines
6. C.P. GROUP INVESTMENT IN CHINA ( Agri-business, Retail Distribution, Automotive
Parts & Industrial, Entertainment Media)
7. MARKETING AND DISTRIBUTION
10. REAL ESTATE AND LAND DEVELOPMENT
9. TELECOMMUNICATIONS
8. PETROCHEMICAL BUSINESS
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C.P. Network
Investment, operation and trading in 22 countries
EU, North America, South America,
Africa, The Middle East and Asia
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Crop Integration Business, CP GroupCore Business
Field Crop
Business
Rice Integratio
n Business
Horticultural
Business
Agricultural
Machinery Business
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C.P.GROUP ALWAYS REALIZE THAT
FARMERS ARE OUR LIFETIME PARTNERS
SO WE DO THE BUSINESS FOR DEVELOPMENT
WE HAVE ESTABLISHED SEVERAL DIFFERENT PROJECTS
WITH THE MAIN OBJECTIVE THAT
IF FARMERS HAVE SUSTAINABLE INCOME
AND BETTER QUALITY OF LIFE
THE COUNTRY WILL ALSO PROGRESS
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1. Considerations to Operate Agribusiness
1. Market Potential
- study global and domestic market condition- production volume- export and import- pricing
2. Knowledge and Technology Potential
- R & D objectives- new product development- product differentiation
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3. Production Potential
- suitable production area- soil type- water source- climatic condition
CONTRACT FARMING
4. Human Resource Potential & Management System
5. Food Safety and Environmental Concern
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Contract FarmingCase Study in GMS / ACMECS
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Complete Package Project
Farmers BAAC Dept. of Ag. Ext. C.P.
C.P. Contract Farm Operations
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Objective
1. To educate new production technologiesby maximizing the yield with lowest cost
of production and risk reduction
2. To promote progressive farmers to beleaders in each location which will laterhelp develop farmer society and income
increase
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Complete Package Project
Cost Reduction/unit Reduce Risk
Yield Increase/area Income Increase/seasonFarmers with Higher Income
New Technologies
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CP 888
CP 989 CP 9988 CP 888S CP AAA CP KKK CP QQQ
Good Hybrid Varieties
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Seed Production
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Pre-Planting Population
Appropriate Technology
Chemical fertilizer & Chemical fertilizer & Herbicide TreatmentHerbicide Treatment
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• New Technology: Environmental Concern
Organic Fertilizer
Bio-Fertilizer
Bio-Pesticide
19 Pre Harvest Technology
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Activities in THAILAND
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Post Harvest Technology
Traditional model
22Local Dryer Technology
Post Harvest Technology
23 Dryer & Silo
Post Harvest Technology
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Contract Farming
in
GMS&
ACMECS
Expansion to Neighboring Countries
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Champion Farmer : MYANMAR
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VIETNAM
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Laos
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CAMBODIA
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30 ACTIVITIES in CHINA
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CP 619
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- Cost & Benefit of Hybrid corn grower in GMS/ACMECS
InputLand Prep and PlantingHarvest and Transport OthersTotal
Average Yield (Kg/rai)Cost per Kg
IncomePrice per KgProfit per rai
%Return on Investment
1,034684464575
2,757
1,0002.76
5,3605.36
2,603
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520 417 280 3901,607
850 1.89
3,009 3.571,402
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Thailand
469338439375
1,621
8002.02
3,0003.75
1,379
85
326646304264
1,540
7252.03
2,7643.81
1,224
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Laos MyanmarCambodia
1,392 700 1,000 188 3,280
720 4.55
4,500 6.25 1,220
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Vietnam China
2,650 743 1,104 250 4,747
1,080 4.39
7,452 6.90 2,705
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ราคาขายข�าวโพดเลี้ �ยงสั�ตว�ที่ � เกษตรกรขายไ ด� ความชื้�� นไ ม�เก�น 14%
2.00
2.50
3.00
3.50
4.00
4.50
5.00
5.50
6.00
6.50
7.00
มค. กพ. ม ค. เมย. พค. ม�ย. กค. สัค. กย. ตค. พย. ธค.
Month
Price( Baht./Kg.)
2544 2545 2546 2547 2548 2549 2550
GRAIN CORN : Selling price at farm gate in THAILAND
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2002 2003 2004 2005 2006 20072001
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ราคาขายสั�งข�าวโพดเลี้ �ยงสั�ตว�ที่ � โ รงงานอาหารสั�ตว�ร�บซื้�� อ
2.00
2.50
3.00
3.50
4.00
4.50
5.00
5.50
6.00
6.50
7.00
7.50
8.00
มค. กพ. ม ค. เมย. พค. ม�ย. กค. สัค. กย. ตค. พย. ธค.
Month
Price( Baht./Kg.)
2544 2545 2546 2547 2548 2549 2550
GRAIN CORN : Buyer price at feed mill in THAILAND
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2002 2003 2004 2005 2006 20072001
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ราคาขายข�าวโพดเลี้ �ยงสั�ตว�ที่ �ตลี้าดชื้�คาโก
2.00
2.50
3.00
3.50
4.00
4.50
5.00
5.50
6.00
มค. กพ. ม ค. เมย. พค. ม�ย. กค. สัค. กย. ตค. พย. ธค.
Month
Price( Baht./Kg.)
2544 2545 2546 2547 2548 2549 2550
GRAIN CORN : at Chicago BOT
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2002 2003 2004 2005 2006 20072001
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GRAIN CORN CONSUMPTION THAILAND
item 2006
2007
2008
2009
2010
Domestic DEMAND
4,200
4,400
4,600
4,800
5,000
Supply in THAILAND
3,800
3,900
4,000
4,100
4,200
DIFF -400
-500
-600
-700
-800
: 1,000 tons
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Supports Need from Government
1. Water source and irrigation
2. Climatic report and forecast
3. Infrastructure
4. Financial supports
5. Training
6. Intellectual property right
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Causes of Failure
1. Uncontrollable Factors
- Drought - Flooding
2. Communication gap Misunderstanding
3. Transportation Problems
F
4. Farmers
5. Team Work
6. Government Policy and Supports
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Win + Win + Win
Conditions for Success in Contract Farming
Key Issues:
1. Production Technology Pre & Post harvesting Technology
2. Technology Transfer Gov. officer
Private Sector
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3. Building TRUST Mutual Benefit
4. Pricing Policy
Price Information Center Market Price
Minimum Guarantee Price
5. Financial Support Bank of Agriculture
Cooperative Local Grain Collector
6. Human Resource Development
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