Thailand's exports dropped for the fourth straight month in June, attributed to weak global demand because of the global economic slowdown, ongoing trade tensions between the US and China, and lower oil prices.
The Commerce Ministry said yesterday customs-cleared outbound shipments remained in the red, down by 2.15% year-on-year in June to US$21.4 billion after contracting by 5.8% in May, 2.6% in April and 4.9% in March.
Exports in baht terms fell by 2.93% from June last year to 677 billion baht.
Exports to most markets continued to ebb, with shipments to China falling 14.9% in June from a year earlier, while those to the US were down 2.1%.
Agricultural and agro-industrial products fell 9% in June from the same month last year to $3.23 billion, mainly thanks to rice (-34.6%), sugar (-19.4%), frozen and canned seafood (-9.5%), fresh, frozen and processed vegetables and fruits (-10%), and cassava products (-17.5%).
Industrial products inched up by 0.04% to $17.48 billion driven by gold shipments (+317%), cosmetics, soaps, and skincare products (+10%), air conditioners (+9%), and motorcycles and parts (+5.7%).
Falling shipments included oil-related products (-22%), electronic circuits (-20.6%), computers and parts (-15.5%), and steel, iron and products (-15.5%).
Imports in June decreased by 9.44% to $18.2 billion, leading the country to register a trade surplus of $3.21 billion.
For the first six months, overall shipments dropped 2.91% from the same period last year to $113 billion. The trade surplus for the period amounted to $3.94 billion.
Pimchanok Vonkorpon, director-general of the Trade Policy and Strategy Office, said the dip in June was clearly a result of the trade war between the world's two largest economies as Thailand is a key supply chain for China.
Lower global oil prices also led export values of most related products to drop, she said.
The impact from the trade war is expected to stay in effect until the third quarter, said Ms Pimchanok.
However, she believes exports will start recovering in the fourth quarter.
Despite a variety of challenges in common with other export-oriented countries, many positive factors should strengthen exports in the latter half of 2019, namely positive brand image, an opportunity to substitute products subject to retaliatory measures in US and China markets, expansion of tourism-related products, and potential exports to new areas based on customised strategies, said Ms Pimchanok.
The troubling external factors to monitor include unresolved trade disputes, the global trade slowdown, falling commodity prices, currency appreciation caused by expansionary monetary policy in major economies, the business cycle of electronic products and manufacturing adjustments to new consumer demand, such as for electric cars, she said.
"If Thailand is able to maintain export values at an average of $20-21 billion a month for the remainder of the year, overall shipments are likely to grow 0-1% this year," said Ms Pimchanok.
Ghanyapad Tantipipatpong, chairwoman of the Thai National Shippers' Council (TNSC), said June's export fall was not unexpected thanks to the overall global economic slowdown and stronger baht.
TNSC is maintaining its export growth target at 0-1% in 2019, she said.
"If Thailand can manage an average of $22 billion in exports per month, it can record positive growth," said Ms Ghanyapad.
However, she said exporters need to rev up export volume during September to November this year to drive export growth.
Ms Ghanyapad urged the government to help harness the baht's appreciation and ramp up infrastructure investments.
Exporters would like to see baht in 32-33 to the dollar, she said.