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Thai Union Now Produces One Fifth Of All Tuna Cans

 


Thai Union Frozen Products (TUF), the world’s largest tuna canner is responsible for the production of one in every five tuna cans on the shelves of supermarkets globally. That makes TUF the leader within the global tuna processing and marketing industry.

With a cold storage capacity of 99,000 tons the company says, in its annual report of 2012, that it is confident to be able to effectively fulfill consumer demand in terms of product choice and order volume; TUF outlined its potential production volume as one of its major strengths within the industry. The report mentions a combined production of TUF and its other Thailand-based subsidiaries of a huge 580,000 tons per year of tuna raw material annually.

This combination of its cold storage and processing capacity, along with its financial resources make the company the most powerful global player in the tuna industry, with massive buying power.

Major strategic challenge for Thai Union remains its lack of backward vertical integration, into the tuna fishing sector, giving the company a level of dependence of 3 dominating Taiwanese, American and Japanese tuna trading houses. These traders largely control the global supply chain and flow of raw material from the tuna fishing fleets to the processing facilities, giving them also considerable power in price setting. 

Disappointing financial performance in the first half of 2013 has resulted in TUF’s profits showing a steep decline of over 50 percent year on year. Its tuna margin was slashed to just ten percent in the first quarter of the year, dropping from 14.83 percent in 2012. Despite this, the company forecasts a substantial turnaround in the third quarter.

Thai Union is also active in the processing of frozen shrimp, frozen seafood and petfood, which accounts for about 260,000 tons of production capacity annually.