LONG before durians were a hot commodity, Tan Sue Yee’s family was already converting parts of their oil palm plantation into durian orchards.
According to Tan, at 500acres, Top Fruits Sdn Bhd currently has one of the largest mature durian plantations in town.
Of course, the flurry of investments going into the durian sector in recent years would mean that its size would be eclipsed by larger players in the future. But Tan is not particularly concerned. In fact, he is quite happy to see other durian plantation operators coming into the market. The increase in volume would help normalise the price of durians.
He reminisces of a time in their early days of exporting the fruit when the price of Musang King was a mere RM8 per kg. While higher prices mean better profits, Tan prefers to deal with bigger volumes at reasonable prices. This will make durians more accessible and widen the market.
Tan’s family started growing durian trees in the late 1980s.
“Our family has strong agriculture knowledge. We planted a lot of oil palm and we had a small oil palm mill. We also grew a lot of tropical fruits.
“But during one of our oil palm replanting periods, we just decided to plant durian trees instead. So we converted part of our plantations to durian. Then we moved into manufacturing and export of durian, ” he shares.
Tan and his brother, both medical doctors by training, came on board to help their father expand the business about nine years ago. They formed Top Fruits and went about modernising the family’s operations and farming techniques.
The company worked closely with government agencies to export its produce. And when they started exporting durians in 2010, they also started looking into a proper manufacturing operation.
“We were thinking about how to extend the shelf life of the fruit, so we did frozen durian. They can go as far as the US and Canada markets.”
Top Fruits got its first licence to export frozen durian parts and paste to China in 2011. Thereafter, they also obtained permits to export fresh mangosteens and pineapples, and last year, secured the licence to export frozen whole durians to China.
Top Fruits’ strength lies in its upstream operations. As they are one of the earlier exporters with a sizeable plantation, the company is able to control its whole supply chain from source to end product and export.
As people’s love for the thorny fruit grow, Tan says more food manufacturers are finding ways to incorporate durian into their products. This gave them an opportunity to also increase production of their durian paste.
“We supply to large manufacturers, where our durian paste is used as their ingredients. They will make products like durian ice-cream and pastries. One of our main businesses now is as an ingredients manufacturer, ” he says.
While the company has enjoyed good export growth over the years with its upstream and midstream operations, Tan says they are now focused on expanding its downstream business to cater more to the local market.
Top Fruits’ local efforts will be centred around three main pillars: ingredients supply, food trucks and direct retail business models.
“We have a wide range of durian-based products such as pure durian paste, puree and even durian powder for industry use.
“In the food industry, the staple flavours are chocolate, vanilla and strawberry. But now, durian is also on the list. If more food chains adopt this flavour into their menu, that will have a big impact on demand, ” he says.
But durians, he adds, are often received at two different extremes.
“You either love it or hate it. So fast food chains may hesitate to introduce durian flavoured food. When you walk into a fast food store, for example, you don’t want to feel like you are walking into a durian shop. So we have to develop products that can meet those standards.”
Top Fruits currently has five factories around the country that caters to different parts of its manufacturing needs.
The company also rolled out a number of food trucks over the past two years to bring fresh durians to events such as private parties, company anniversaries and community events. This strategy will help make the company a key attraction for any future celebrations.
“We have trucks of different sizes, depending on the size of the party. We are trying to change the way durian parties are run. The food trucks are well-equipped. You won’t see this type of mobile food truck in the market. We bring them fruits directly from our farm and some of our downstream products as well, ” Tan explains.
Tan also sees opportunities to grow its presence locally through the retail market. Top Fruits produces a number of end-products like durian-based pastries and confectionery under the GoldThon brand. They are currently retailed at high-end grocers such as Oliver Gourmet, Ben’s Independent Grocer and MBG Fruit Shop.
Top Fruits has also introduced two retail models in the local market to push its products out.
“We have two models which are the kiosk and concept store. They are new to the market.
“Our first collaboration is with BIG Pharmacy. We will launch our kiosks in their outlets. This will give us space to display our products and also set up our soft-serve durian ice-cream machine.
“Our concept store will be launched here soon. They will carry all our products. If this takes off, we may explore franchise opportunities in the future, ” he says.
Products under the GoldThon brand will also be brought to other markets like Singapore, Thailand, Taiwan, Hong Kong, China and Indonesia.
The company has a solid R&D team of 10 people who are looking into the development of more products for the local market.
Tan is confident that its downstream focus will add to its future sales. Top Fruits currently generates revenue of about RM50mil.
While plans are underway for its local businesses, Tan is not about to neglect its upstream segment. The company is in the process of planting more trees to boost supply.
But apart from just cultivating its own produce, Top Fruits’ agriculture division also provides services to other durian farms.
“We help other durian growers with modern farming methods. Most of them use conventional ways, where you only see fruits after eight to nine years. With modern techniques, you’ll be able to see the yield within five years.
“We also do a lot of durian rehabilitation programmes with the government, especially in Sarawak. We do technology transfers and teach them to use things like the right fertiliser to have a better yield.
“We also work with a lot of new farms under our contract farm arrangements to buy back the fruits from them, ” he says.
The company also tries to maximise the use of the fruits to minimise waste. While the durian flesh is processed for food, the seeds are used for seedlings and the shells crushed for fertiliser.
Tan opines that the durian fever will last for another 20-30 years. As investments flood into the industry, total durian production per year is estimated to double to 500,000 tonnes by 2023 from 250,000 tonnes currently.
According to Tan, about 30% of the current production is of the Musang King variety.
“Export for Musang King is growing because demand is growing, especially from China. At the moment, about 90% of China’s durian import is still mostly from Thailand. If the price (for Malaysian durian) drops to only double the price of Thai durian, demand will go up.
“We are also trying to diversify our export market so that it’s not just China. We are going to India as well. They like it, but the price keeps going up so it is beyond their affordability. When production increases, the price will be more affordable and more people can eat them.
“What we want is a healthy price.”