Thailand flexes muscles to strengthen foothold in the global condom market
By ThaiDay 13 February 2006 16:55

Thailand has the potential to give the European Union a run for its money as the top supplier in the US$300-million global market for condoms, KResearch said in a report. Since it has an abundant supply of natural rubber, Thailand should be able to move up from being second-largest exporter of condoms in the near future, said the research arm of Kasikornbank. Annual sales of the local condom industry are estimated at 650 million baht.

The EU commands a global market share of 40 percent, while Thailand has 15 percent. Other major condom exporters include the US, India and Malaysia. It is likely, however, that Thailand will be more aggressive in the world market because several large condom manufacturers are considering establishing operations in Thailand to capitalize on the countryтАЩs abundant supply of natural rubber, KResearch said. Demand for condoms is rising in many countries due to safe sex and AIDS prevention campaigns. Some countries have been largely dependent on imported condoms, said the think tank.

Thailand, which was chosen by the World Health Organisation to host the 15th International AIDS Convention in 2004, has been widely praised by WHO and AIDS prevention campaigners for its 100 Percent Condom program, a safe sex campaign launched in 2004. This should further boost the countryтАЩs chances to hike condom shipments. Last year, Thailand exported 4,686 tonnes of condoms (a kilogram is equivalent to 720 condoms) to nearly 70 countries. The total shipment was 16.1-percent more than 2004, KResearch said.
Export revenues last year rose 22.9 percent to 1.83 billion baht from 2004, the think tank added.

Local condom manufacturers last year were able to take advantage of increased demand in the world market. Overseas buyers were anticipating a rise in the prices of condoms and a possible tight supply due to the spread of AIDS in parts of the world. A number of countries stockpiled condoms from Thailand, said KResearch.

ThailandтАЩs main markets for condoms include the US, Japan, UK and Russia. Last year, more than a fourth or 26.7 percent of condoms made by Thailand were sold to the US, 11.5 percent to Japan, 10.5 percent to the UK and 6.2 percent to Russia, said KResearch. Other emerging markets for condom exports are Southeast Asian neighbors as well as countries in Africa.

Meanwhile, more condom users in Thailand favored imported brands last year. Imports totaled 58 tonnes valued at 30.93 million baht, said KResearch. Consumption of imported condoms last year rose 25.1 percent by volume from 2004, and 9.9 percent by value. Nearly six in every 10, or 57 percent, of imported condoms sold in Thailand last year were US-made. Japanese brands accounted for 20.2 percent of imported condoms, while condoms from India accounted for 15.9 percent of total imports. KResearch said the import figures are still low, but local manufacturers have to study thoroughly Thai consumer preferences and understand why some prefer imported condoms. They should also engage in more research and development studies to improve their production processes.

ThailandтАЩs 10 condom manufacturers have a combined daily production capacity of three billion condoms. They have continually explored new overseas markets, while conducting research and development to keep up with changing consumer preferences in the world market, the think tank said. KResearch said it is also important for local manufacturers to maintain their product standards and keep up with production requirements of importing countries. Since 1990, condoms have been included in the Health MinistryтАЩs list of medical equipment and supplies that are covered by strict production regulations. Condom manufacturers are required to indicate production and expiry dates on their packaging and register their products with the ministry.

courtesy
Thai Day - International Herald Tribune

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