Durian, the aptly-named 'King of Fruits', generates the highest revenue for Thailand out of all its fruit exports. Since 2014, the export value for durian has surpassed all other fruits, and just recently reached a monthly record high of USD 934.9 million in May 2021, with growth of 95.3 percent YoY. Export value during the first five months of 2021 stood at USD 1.839 billion, accelerating sharply by 45.2 percent YoY. This figure places durian ahead of cassava, and second only to rubber among Thailand's key agricultural products. Despite the COVID-19 pandemic, export value for Thailand's fresh durian in 2020 set an annual all-time high of USD 2.073 billion, with growth of 41.5 percent YoY. Going forward, there will still be more opportunities to set new records.
At present, the global market has warmed to Thai durian exports, allowing the fruit to penetrate more markets. As the world's number-one consumer of durian, China accounts for 70 percent of all durian exports in the global market. Since Hong Kong makes up nearly 20 percent of the remaining market share for durian, the Chinese market alone dominates the overall durian market. Given this, Thai durian has bright prospects as Thailand is the world's largest durian exporter in terms of both volume and export value, with a global market share that has grown continuously and stood at 75.9 percent in 2020 (compared to 65.9 percent in 2019). Factors that contributed to Thai durian's competitive advantage include: 1) Thailand's long-standing experience in exporting fruits; 2) its close proximity to China which enables shipments of fresh durian to reach Chinese consumers quickly and at acceptable prices; and 3) the unique taste of Thai durian that has become widely regarded in the global market, with Thailand setting the taste standards for durian prior to any other countries.
Recently, durian prices have risen continuously due to surging demand for durian in the Chinese market. For this reason, many ASEAN countries have expressed interest in competing in China's durian market, which would pose a bigger challenge to Thai durian exports in the future. While Thai durian represents 99 percent of all durian imported by China (including Hong Kong), Thai durian supply is currently insufficient to satisfy strong demand from many regions across China. Hence, China has had to import durian from other countries as well. To maintain their market share, Thai durian exporters should rapidly adopt proactive marketing strategies..
Thai durian has consistently performed well in foreign markets. KResearch perceives that over the remainder of 2021, Thai durian will continue to see strong growth as planting areas and yields can still be increased. For 2021, total exports of fresh Thai durian are expected to grow by around 35-40 percent YoY, with an export value of USD 2.8-2.9 billion. Although durian from Thailand's regional rivals has started to penetrate foreign markets, their production capacity is relatively small, it may take 4-5 years before they can accelerate their production to compete with Thai shipments. Over the next decade, Thailand can expect increasing competition from new rivals like Malaysia, Vietnam and Indonesia. While our competitors are working to increase their yields, Thai durian farmers should expedite proactive marketing to attract new consumers ahead of its rivals – especially expansion of the durian market to China's inner provinces, which are also being targeted by Thailand's competitors. Focus should also be on the introduction of other durian varieties, the use of social platforms for marketing purposes, and e-commerce. Thai durian could be upgraded as a premium product from its planting, through to harvesting at the appropriate time, and logistics. Branching out to other Asian countries that are already familiar with Thai fruits and new markets in other regions should also be considered.
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