Thai exports drop more than forecast in July, seen rising in Q4

A view of Bangkok’s port along Chao Phraya River is photographed during sunset in Bangkok, Thailand. REUTERS/Athit Perawongmetha/File photo

BANGKOK  – Thai exports shrank for a 10th consecutive month in July, and by a far bigger rate than expected, as global demand remains sluggish, and the commerce ministry said on Friday it would be difficult to meet its full-year export growth target.

Customs-based exports, a key driver of Thailand’s economy, contracted 6.2 percent in July from a year earlier, compared with analysts’ average estimated dip of 0.75 percent in a Reuters poll. Exports had slumped 10.8 percent from June.

“A sharp decline in global commodity prices, resulting from the conflicts in Ukraine in the preceding year, led to a significant slowdown in related export values,” the ministry said in a statement, adding China had also faced a slow recovery.

The slump in Thai exports, however, was less than that of many other countries, Keerati Rushchano, the ministry’s permanent secretary, told a press briefing.

“Despite July’s export fall, the big picture in terms of value, we are not bad,” he said, citing last year’s high base of comparison for the drop.

The July export value was $22.14 billion versus $23.6 billion in the same month in 2022.

The ministry would try to meet its export growth target of 1 percent to 2 percent this year, Keerati said, but noted it would be difficult.

Exports in the first seven months of 2023, which contracted 5.5 percent year-on-year, were satisfying, he said.

“In the remaining four to five months, we will put our efforts to make the numbers not too ugly,” he added.

Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council, said exports would increase in the fourth quarter of 2023, owing to last year’s low base and higher car shipments.

“But if the economies of trading partners have not recovered, exports might contract 1 percent this year,” he told the briefing.

In July, exports of computers and parts tumbled 24 percent year-on-year, while autos exports jumped nearly 30 percent. Rice export volumes rose 4.5 percent on-year to 604,310 metric tones.

Exports to the United States rose 0.9 percent on-year in July, while shipments to Southeast Asian countries fell 21.8 percent. Exports to Japan fell 1.7 percent and shipments to China declined 3.2 percent.

In July, Thailand posted a trade deficit $1.98 billion, bigger than a forecast deficit of $1.3 billion, with imports sliding 11.1 percent year-on-year.