Dr. Sittiporn Praneenij on Thai broiler industry: â€śFarming is moving towards a 4.0 modelâ€ť
Authors: Albert Curto and MarĂa SabatĂ©
Dr. Sittiporn Praneenij is Senior Vice President of the C.P. Animal Health Business Group,Â subsidiary of the Charoen Pokphand Group (C.P. Group). He received his doctorate on Veterinary Medicine at the Kasetsart University (Thailand) in 1979. During his career, he has occupied several managerial and directorial positions in companies within the Agro-Food sector in Thailand and several countries.
He had gained his most valuable experience within the Thai Veterinary Society from being the committee member of the Thai Veterinary Medical Association Under Royal Patronage for 2 periods of altogether in 4 consecutive years ( 2004 â€“ 2008 ). Besides his business responsibilities in the Group, he is now the member of the committee of Charoen Pokphand for Rural Life Development Foundation, with the key objectives of supporting the development and the quality of life in Thai rural areas’ communities, giving special attention to education.
Within the company group, Charoen Pokphand Foods Public Company Limited (CPF) is one of the worldâ€™s leading listed Agro-Industrial and food conglomerates, which operates a vertically integrated business comprising swine, broilers, layers, ducks and the aquaculture sectors.
The Company operates in 16 countries and exports products from Thailand to over 30 countries, covering 4 billion population around the world. CPF’s businesses incorporate the manufacturing of animal feed, animal breeding and farming, meat processing, the manufacturing of semi-cooked meat and fully-cooked meat, food and ready-meal products, meat and food retailer as well as restaurants.
Given your membership in the Committee of the Thai Veterinary Association, how have veterinary sciences evolved in recent decades?
At least until 2018, Thailand has 9 certified Veterinary Faculties producing around 600 veterinarians per year. However, to reach that point, we need to look back at His Majesty King Rama the 9thâ€™s period â€“ King Bhumibol Adulyadej of Thailand reigned from 1946 until his death in 2016.
Developing Thai rural areas was one of the Kingâ€™s principles. Therefore, veterinary sciences in Thailand were aligned with government sections to support farmers; modernizing the agricultural sector in order to be able to produce enough food for daily consumption and achieve better living standards for Thai people. From time to time, Thailand has also had substantial support from private sector and more developed countries, but improving agriculture was always one of the main pillars in the Kingâ€™s principles.
Once we increased productivity, veterinary science in Thailand played an integral part in improving quality in animal production. A safe farm means safe food. Nowadays we produce very well-prepared veterinarians, whose abilities are allowing Thai animal producers to move towards better quality standards, also thanks to new production technologies.
Could you give more details about King Rama the 9thâ€™s guidelines for Thai Agri-Food industry?
His Majesty King Bhumibol created his own philosophy of development for Thailand, known as â€śSufficiency Economyâ€ť. Broadly speaking, â€śsufficiencyâ€ť entails moderation, reasonableness and prudence. These three values shape Thai mindset at all levels, from families to communities, from business to nationâ€™s administration. Sufficiency is the path His Majesty King Bhumibol chose to cope appropriately with challenges arising in an increasingly global world.
King Bhumibol was very young when he moved from Switzerland to Thailand to become monarch, after his brother passed away. Since the beginning, he visited impoverished rural areas and worked together with professionals to modernize agriculture and farms to produce all what the country needed. Sufficiency economy, when applied to this context, entailed three different stages. First, knowledge and competency to improve national industry; second, knowing what is on demand and where to sell it; and third, achieve business sustainability and investment.
How all these changes affected the poultry sector?
All these new measures affected society as a whole. Thai broiler industry was not an exception, although the development went through a stage of adoption, subsequently followed by a continuous stage of adaption to changes in the market.
Before 1970s, agriculture in Thailand was based on subsistence. There were considerably more farmers and they used to have livestock in their backyards, in small quantities, and grew food crops to feed basically themselves and their families. In fact, the founders of C.P. Group, Mr. Ek Chor and Mr. Siew Whooy started the business with a small seed shop named Chia Tai, in 1921.
In the early 70s the second generation of C.P.â€™s management, formed by the Chearavanont brothers, introduced broiler chicken into the Thai market. Mr. Dhanin Chearavanont brought a white chicken breed from the United States. Until then, chicken meat was consumed in the Chinese New Year Festival but it was not common in daily meals. During this decade, backyard farms started a process of development into small and medium farms.
In 1980s, Thailand started exporting part of its produce and in the 90s exports shifted from frozen boneless chickens to processed and precooked chickens to overcome a loss in competitiveness, mainly due to Chinese competition. From 2000s, European Unionâ€™s legislation regarding new farm standards made Thai broiler industry to introduce better health and safety measures to comply with trade requirements.
In 2004, there was the Avian Flu outbreak and raw and frozen chicken nearly disappeared from the market. There was a global concern from health authorities and consumers regarding food safety. CPFâ€™s advantage back then was its processed and cooked chicken business, which proved to be safer. Avian Flu was a shock for Thai raw chicken exports and nearly all our production sent abroad consisted of cooked chicken, in which we have specialized diversifying our products. Raw chicken exports did not take up until well after 2010, thanks to Japanese market.
Then, what is the next step forward?
Technology. Farming industry is moving towards a 4.0 model of innovation. Automation and digital farming equipment are gradually being introduced in all production processes. The consequence is that human labor is becoming more and more unnecessary. In the near future, a poultry farm will easily produce a million chickens with barely 10 workers.
You have experience in countries such as Vietnam and Indonesia. Could you give us a brief description of the situation of the agri-food industry in these countries?
I worked in Vietnam from 1996 until 1999. Back then, the countryâ€™s agri-food industry was not very developed. However, from 2000 on, Vietnam has changed very rapidly. With a population over 90 million people, Southern Vietnam has plenty of water and extensive fertile land. In fact, it is a major producer of rice and coffee. Only the improvement on plant genetic could allow Vietnam to scale up its production to more crops and improve quality. Vietnamese consume pork meat roughly twice as much than broiler meat (31 kg per capita vs 13 kg per capita), so swine production there is a very important industry.
Regarding Indonesia, and being Secretary of the Thai-Indonesian Business Club between 2000 and 2003, I know that both countries have fluent economic interrelations. In fact, C.P. Group has its own Indonesian branch, or company group there. What we know is that chicken meat consumption there is much lower in proportion (7 kg per capita), compared to both Vietnam and Thailand. Pork meat consumption is obviously insignificant, due to religious beliefs. However, Indonesia is a major producer of rice, tobacco and corn, and has a tremendous potential in poultry production for the whole Asian market.
Based on your working experience abroad: Do you consider that the development of the agricultural industry improves access to better nutrition for human population and is, therefore, a factor for social stability?
It is, indeed. As I mentioned before, chicken meat was only eaten occasionally in Thailand before 1970s. It was expensive and production was low. Nowadays, chicken is an affordable source of proteins for everybody.
Things have changed so much in recent years. Development of agricultural sector evolves together with societies. In the past, the motto used to be â€śfood goes from farm to the tableâ€ť. Nowadays it has all gone the other way around; what is produced in the farms is decided in the table. We shall ask â€śWhat would you like to eat?â€ť. Market demands changes rapidly, so we definitely need get closer to the consumer and work accordingly to their demands.
Based on your extensive experience at C.P. Animal Health, do you agree with the statement that in recent years animal health has gone from being a mere objective to a basic condition in the food industry?
What it is clear is that food safety is very regulated nowadays. In the last decades, we have had some disease outbreaks, such as the Mad cow disease (BSE) from 1980s on, the Avian flu in 2003, the Horsemeat Scandal in 2013 and in recent years we are going towards an antibiotic free environment due to international call to action on global antimicrobial resistance. All these events have raised the concern of food safety, and have forced the industry and the society as a whole to take animal health very seriously. This is good.
Fortunately, today we have better global safety standards. At the end, it all comes down to traceability. CPF was pioneer in Thailand for its fully integration of processes affecting broiler production, from the feed-mill to the retailer. That is what we have already described as vertically integrated business. If we control the source of raw materials with which animal feed is manufactured, how and where it is manufactured, the breeder farm, the hatchery, the broiler farm, the process of slaughtering and further processes, it is easier to enhance quality and food safety throughout the chain.
Despite that food safety, Antibiotic-free or GMO-free food are amongst the most relevant concerns, society is also demanding the industry to take responsible decisions regarding the environment or animal welfare, for instance.
How are current food safety regulations in South East Asia?
The European Union is, perhaps, one of the best examples for us in that matter. At the end of the day, I strongly believe in the concept â€śone world, one healthâ€ť; animals and humans are interconnected, so infectious diseases can spread easily if not taken care of. Thai industry is pretty much following what the EU and other major trade partners, such as the United States and Japan, are doing. Since we are exporting 40% of our broiler production to markets around the world, we need to adapt to local regulations. If we were incapable to do so, we would be out of business.
When it comes to Thai internal regulations, from time to time, we realize that CPF is already complying with European, US and Japanese food safety standards and setting the same high standard for the whole industry. After all, I think this is good because I am sure there is still room to improve in Thailand and we know how to implement food safety measures other countries in this region are already following.
You have complemented your veterinary scientific training with business leadership training. What influence does veterinary technology have on your decisions as a business leader?
As my top priority for C.P. Animal Health Business Group, I can assure that food safety is key to our business, so animal health is well entrenched within our company values. Veterinary department plays an important role in that matter and new veterinary advances are taken into account in business decisions regarding not only food safety, but also innovation, quality and our ability to adapt to new situations.
For instance, current trends on animal feed additives are different from a decade ago, after concerns of antimicrobial resistance in food and further new regulations to counteract this situation. Veterinary technology, understood as potential products able to either replace or offer alternatives to the use of antimicrobials, is decisive in the decisions we take. The solution seems to be in non-antibiotic antimicrobial products, probiotics, immune enhancer products and natural products.
What challenges may Thai agri-food industry face in coming years?
From a CPF’s perspective, we identify challenges arising from different fronts. In one hand, problems might be derived from diseases and food safety issues around the world, which could imply more regulation and further adaptation. Climate change and other environmental problems may also be a test to Agri-Food industries. On the other hand, we should not forget society. Different dietary trends that are already taking place when some people in the world make the decision of not eating meat. Technology and innovation could also be a challenge for animal-producing industries when meat can be grown in laboratories.
8000 years ago, humans domesticated some terrestrial animals to replace hunting. It seems now that the same situation is repeating with aquatic animals. What sea or river species do you consider should be domesticated?
In Thailand, we have nearly covered all species that can be domesticated in farms. Perhaps species such as the octopus or similar cannot be domesticated, yet. However, most animals that can be found in the sea or rivers can be domesticated.
Thai animal farming produce species that are not necessarily known and consumed in our local market. For instance, there are crocodile farms, ostrich farms and even most species of wild animal farms. Thailand is also a major producer of insects for human consumption, such as grasshoppers, cricketsâ€¦ We also produce insect feed for those species.
I cannot really tell which species will be soon domesticated, but we have covered pretty much all.
To conclude, recommend us a Thai sapiential proverb that could be useful to Western society immersed in stress, a mutation of values and ethical disorientation.
As I mentioned before, Thailand is pretty much inspired by His Majesty King Rama the 9thâ€™s Sufficient Economy philosophy. In Thailand we value moderation and reasonableness in every decision we make, so I have two proverbs that somehow depict them:
â€śCut your coat according to your clothâ€ť, which is the equivalent of living according to your resources and possibilities. There is another saying with a similar meaning that, translated into English, would be something like â€śsmall birdâ€™s beauty is as small as it needs to beâ€ť. Everything comes in a correct proportion; no more, no less.