Thai export growth of 7% in August tops forecasts
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Thai export growth of 7% in August tops forecasts

Rapid rise of baht could dent fourth-quarter shipments, commerce ministry says

Gantry cranes are seen at Bangkok Port in Klong Toey. (Photo: Pattarapong Chatpattarasill)
Gantry cranes are seen at Bangkok Port in Klong Toey. (Photo: Pattarapong Chatpattarasill)

Thailand’s exports rose for a second straight month in August, the Ministry of Commerce said on Wednesday as it maintained its forecast of 1-2% growth this year despite the baht strengthening to 30-month highs against the US dollar.

With demand picking up in key markets, further export growth was expected this year and it could even come in above forecast, although the baht’s rise would impact fourth-quarter shipments, said Poonpong Naiyanapakorn, head of the ministry’s Trade Policy and Strategy Office.

The US dollar value of Thai exports, a key driver of Southeast Asia’s second-largest economy, rose 7% in August from a year earlier, and followed a 15.2% rise in July, which was the fastest growth in 28 months. Economists in a Reuters poll had expected an increase of 5.8% in August.

The value of imports to Thailand rose 8.9% in August, compared with a forecast rise of 7.3%.

That led to a trade surplus of $260 million in August, compared with a forecast deficit of $70 million.

The value of Thai exports to the United States rose 3% in August from a year earlier, while exports to China were up 6.7% but those to Japan were down 11.3%.

Rice exports rose 39.5% from a year earlier to 885,387 tonnes, and were up 47% in value terms to $562 million.

In the first eight months of 2024, exports were up 4.2% year-on-year, while imports were up 5.2%, with the cumulative trade deficit at $6.35 billion.

The baht has risen by 4.6% against the dollar since the beginning of the year— with double-digit gains in the past month — to become the region’s second-strongest performing currency after Malaysia’s ringgit.

“The stronger baht is impacting liquidity and profits, especially for agricultural goods,” said Chaichan Chareonsuk, chairman of the Thai National Shippers’ Council.

“Some business could take a loss when negotiating new orders or not get orders,” he said.

The Ministry of Finance and the Bank of Thailand are due to meet next week to discuss currency appreciation and the country’s inflation target.

The central bank said on Wednesday that it was closely monitoring the currency and was ready to reduce volatility if necessary.

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