Two companies control Thailand’s beer and spirits market; law changes unlikely to greatly affect customer choice

Picture: Thai Rath

Two companies control Thailand’s beer and spirits market; law changes unlikely to greatly affect customer choice

Thailand’s most influential media Thai Rath investigated the history of beer and spirits production in the country.

They said that most Thais know that the multi billion baht business is tied up in the hands of two major players.

And they concluded that changes in the law this week are unlikely to change that duopoly and that customer choice will largely remain limited to the offerings of the big two.

Back in 1927 alcohol production and foreign imports were all in the hands of the state.

By 1959 things had been opened up to the private sector and further big changes came at the turn of the century when many new factories were built.

But only two companies controlled the market – Boodrawd Brewery and Thai Beverage.

Investment needed was huge and these companies had an advantage in being able to control most of the market shutting out smaller firms.

In addition Thai laws created obstacles for competitors to enter the lucrative business.

The big two just got bigger.

Back in 2020 alcoholic drinks made up 21% of the entire drinks market in Thailand, according to the Krungsri Research thinktank.

Its value was 473 billion baht or 64% of the entire beverage market.

Beer made up 54.3% and spirits 37.9% of the alcohol market.

Boonrawd were the first brewery in Thailand and are responsible for such household name brands as Singh, Leo and My Beer.

Thai Beverage were second to the party but rapidly expanded with brands such as Chang and Federbrau.

Together they controlled 95% of the beer market with Boonrawd still #1 in market share.

When it came to spirits there has developed even less competition with new competitors unable to get a foothold in the market.

Thai Beverage controls 80% of the spirits market and has 18 production facilities nationwide as well as control over imports via companies in its portfolio.

There are 30 main brands including Mekhong, Hong Thong, Saeng Som, Blend and Crown99 among many others.

Euromonitor reported in 2020 that the beer market in Thailand was worth 260 billion baht with Boonrawd controlling 57.9% and Thai beverage 34.3%. Thai Asia Pacific Brewery had just a 4.7% stake in the total market.

Main brands and market share were Leo 44.8%,Chang 31.2%, Singh 11.2%, Heineken 3.8% and Archa 2.4%.

Spirits were worth 180 billion baht with Thai Beverage controlling 59.5%, Diageo Moet Henessy 8% and Regency Brandy 4.4%.

Top brands and market share were Ruang Khao 30.9%, Hong Thong 11.4%, Blend 285 11.2%, Regency 3.6%, Saeng Som 3% and Mekhong 2.5%.

Alcohol consumption per capita in Thailand leads the way among ASEAN nations.

The pandemic however caused a severe contraction in the market that is recovering in 2022.

Thai Beverage reported in the first nine months of 2022 that beer sales were up 15.3% and sales growth was 9%.

However, Krungsri have predicted that in the period from now until 2024 the market will rise but will not achieve pre-pandemic levels.

This is due to state controls, advertising controls, zoning and campaigns to stop people drinking due to public health concerns.

Thai Rath concluded that changes to the law announced on Wednesday would do little to change the booze duopoly in Thailand.

Meaning that customer choice remains and will continue to be limited.