Output up 4.2% in November

Output up 4.2% in November

Thailand's industrial output rose more than expected in November, after falling in the previous month, on higher production of cars, engines and rubber products.

The manufacturing production index (MPI) in November rose 4.23% from a year earlier, according to the Industry Ministry's Office of Industrial Economics (OIE).

In the January-November period, the index rose 1.52% from a year earlier. The ministry expected output to increase 1.5% for the full year in 2017 and 2% next year.

Capacity utilisation at factories in November was at 64.2%, up from a revised 60.2% in October.

Industrial goods account for 80% of total exports, which in turn make up about two-thirds of Southeast Asia's second-largest economy.

The Bank of Thailand expects the economy to grow 3.9% this year and next. Economic growth in 2016 was 3.2%, still lagging our regional peers.

Siriruj Chulakaratana, director-general of the OIE, said a major factor supporting the increase in MPI in November was rising production in the automobile, rubber product, auto engines, palm oil, petroleum and petrochemical industries.

He also attributed the rise to higher exports of major industrial products, which gained 16% year-on-year in November, while imports of raw materials for industrial products increased 11.7%, implying that exports of industrial products should continue to grow over the next few months.

Breaking down each sector, production in the auto sector rose 9.53% year-on-year, while rubber grew 23.0% because of rising demand from China.

Production of engines rose 14.3% from the previous year because of the recovering auto sector and strong demand during the recent Motor Expo.

Production of palm oil gained 53.5% for the period because of higher palm fruit supply, accelerating palm-crushing and refining businesses.

The petroleum sector grew 7.09% from the previous year because of rising demand for petrol.

However, the OIE expects the MPI to drop slightly in December as there are several holidays in the month, making some economic activities sluggish.

For the full year 2017, the MPI is expected to grow by 1.5-2.0%, rising to 2.0% in 2018, said Mr Siriruj.

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