February exports beat contraction

February exports beat contraction

Arms shipment helps snap losing streak

Customs-cleared exports rebounded in February after a three-month contraction, but the increase was largely due to a one-time shipment of arms for military drills and the transport of oil-related products and gold.

The Commerce Ministry reported on Thursday that Thailand's outbound shipments rose 5.9% year-on-year last month to US$21.55 billion.

Without oil-related products, gold and weaponry, exports would have contracted 4.9% from the same month last year, said Pimchanok Vonkorpon, director-general of the Trade Policy and Strategy Office.

Exports in baht terms rose by 5.5% in February from the same month last year to 678.50 billion baht.

On the import side, value in February fell by 10% year-on-year to $17.5 billion, resulting in a trade surplus of $4.03 billion.

For the first two months of 2019, exports registered 0.16% growth from the same period last year.

Agricultural and agro-industrial exports fell 0.9% to $3.139 billion, weighed by rubber (-15.8%), cassava products (-1.1%), frozen and processed shrimp (-15.6%) and rice (-21.5%).

Shipments of some products increased, including fresh, frozen and processed fruits and vegetables (+18.7%), fresh, frozen and processed chicken (+10.2%) and beverages (+16.3%).

Industrial product exports rebounded with 7.5% growth to $17.7 billion, led by gold (+107.9%), rubber products (+9.0%), cosmetics (+35.2%) and iron and steel products (+2.7%).

But exports of some products declined, including oil-related products (-3.8%), internal combustion engines and parts (-18.3%), computers and parts (-14.1%), automobiles and parts (-7.9%) and jewellery and accessories excluding gold (-7.7%).

Ms Pimchanok said most export markets were affected by the ongoing trade war between the US and China and unfavourable global trade sentiment.

But exports to traditional markets rose by 23%, led by the US, to which shipments surged 97.3% from February of last year.

"The overall outlook of Thai exports in the first quarter is not very good, but we are positive that the prospects will improve in the second quarter," Ms Pimchanok said.

In a move to boost exports in the remaining months, the Commerce Ministry is readying more than 100 trade promotion missions from February to July, aiming to boost export revenue by up to 65 billion baht.

The latest Sourcing Forum activity in February 2019 was considered a success. Over 200 importers and Thai exporters participated in the event, and more than $100 million worth of purchase orders were recorded.

The ministry will enhance trade through digital platforms such as Thaitrade.com and other potential e-marketplaces -- connecting offline trade to online trade and bridging the local economy to the global arena.

As for China and India, the ministry has formulated tailored export strategies for each potential state or province. The ministry will organise trade missions to expand trade opportunities in prospective markets such as Africa, Latin America and Eastern Europe.

Next week, Chutima Bunyapraphasara, the acting commerce minister, and high-ranking officials of the ministry are scheduled to discuss and evaluate Thailand's export prospects with Deputy Prime Minister Somkid Jatusripitak.

The ministry has forecast export growth of 8% for this year after a 6.7% rise in 2018.

Ms Pimchanok said that after the first quarter the ministry will discuss whether to revise the growth forecast with the private market, citing increasing risk factors such as the baht's strength, ongoing trade disputes and new free-trade agreements.

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