Coconut suppliers in the south of Thailand are deep in debt with 40 million coconuts in stock and few buyers. Coconut lhong, or middleman-run warehouses in Thap Sakae district in Prachuap Khiri Khan just south of Bangkok, have debts of more than 200 million baht (US$6.1 million).
The reason for the large amount of unsold fruit is that many factories have been buying imported coconuts instead of the locally-grown ones from the warehouses.
More than 30 middleman-run warehouses are facing huge losses this year. About 80% of the people in Thap Kasae district south of Bangkok make money from growing and selling coconuts.
Issara Judphai, who runs Issara Coconut Lhong, said as well as the oversupply, the price of coconuts had dropped this year. Last year the retail price was 15 baht per coconut, but this year it was only 4 to 5 baht per coconut.
He said he normally stocks 10,000 coconuts in his warehouse at a time after buying them from farmers. In one month he normally turns over 300,000 coconuts.
The middleman often keep hundreds of thousand of coconuts in their warehouses for buyers in case there is a shortage of supply. However, demand has been very low this year, while the number of coconuts grown has risen.
There are also problems storing the fruit. After four months they start to grow roots, stems and leaves and cannot be consumed. Issara said the only solution is a freeze on imports so the local stocks get used.
Kitsana Kratomsri, another middleman in Prachuap Khiri Khan, said he cannot recall the situation being so bad. He said he keeps buying coconuts from farmers because he feels sorry for them and they are his regular suppliers.
He wants the government to declare coconuts an industrial crop and create funds to help farmers in the long term. He also wants the government to fix the price of a coconut at 15 baht each.