Food industry expansion slows amid surging costs and weak consumer spending

Thailand's food and beverage market is projected to reach 682 billion baht in 2026, marking a 3.9% year-on-year growth, according to the Kasikorn Research Center (KResearch).

The growth rate continues to decelerate though, and remains uneven across the sector due to fragile consumer purchasing power, intense competition and elevated operational costs depressing profit margins.

The projections were highlighted today during the opening of the ‘Makro HORECA 2026’ at IMPACT Muang Thong Thani, running through November 1.

The event gathers operators from the hotel, restaurant and catering (HORECA) sectors, as well as chefs and trade partners, to showcase Thai culinary potential and drive industry collaboration.

Department of Business Development Director-General Kittiwat Patchimnan stated that they are accelerating efforts to support food operators, grocery stores and small businesses.

He emphasised the upgrading of skills, creating market opportunities and establishing business networks to help operators adapt to changing consumer behaviours and maintain competitiveness.

Food business operators at the event reported mounting operational pressures, noting that production costs have jumped by more than 20%, while logistics expenses have surged by over 70%.

In response to fierce competition and reduced consumer spending, businesses are forced to innovate, develop unique selling propositions for younger demographics, diversify sales channels and adopt international production standards.

KResearch noted that, while the 2026 forecast of 3.9% growth is a slight upward revision from an earlier estimate of 2.5%, profit margins remain heavily constrained for operators of all sizes.