The Thai furniture market is expected to grow by 4.5% this year to 46.5 billion baht, driven by both domestic sales and exports, as the property market continues expanding and the economic recovery continues at home and abroad.
Dhanakorn Kasetrsuwan, vice-chairman of the Thai Furniture Industries Club (TFIC) and the Asean Furniture Industries Council (AFIC), said export growth of Thai furniture in January was 33% year-on-year, carrying on the momentum from 2017.
"With the world's economic expansion, Thai exports have boasted big growth rates since last year and will carry on in 2018," Mr Dhanakorn said. "The Thai economy is also pushing on with estimated growth of 4.2% this year."
Last year the Thai furniture market was valued at 44.5 billion baht, up from 42.2 billion in 2016 and 40.5 billion in 2015. Of the total last year, 36 billion baht was from exports, which rose from 34 billion in 2016 and 32.5 billion in 2015.
The export market for Thai furniture this year is forecast at 37.6 billion baht, with Japan, the largest market, accounting for 30%, followed by the US (20%), Europe (10%) and China (8%).
Domestic sales in 2018 are forecast to rise to 8.88 billion baht from 8.5 billion in 2017, 8.2 billion in 2016 and 8 billion in 2015, Mr Dhanakorn said.
"Some property developers estimate growth of 11% to 470 billion baht for that market this year, but we conservatively anticipate 5% growth in the domestic furniture market," he said.
To boost export and domestic growth, the TFIC will spend 24 million baht to hold Thailand International Furniture (TIF) Expo 2018 during March 7-11 at Impact Muang Thong Thani, with 120 furniture manufacturers exhibiting their products.
"This will be the first time the TFIC has held its own fair," Mr Dhanakorn said. "We need to hold it this month, as there will be other furniture fairs organised in Asean countries in March."
A furniture fair in Malaysia was held March 2-3, while events are planned for Vietnam and Singapore on March 8. The confluence of regional events is expected to attract dealers from around the world.
"If we do not hold it this month, we will lose out on opportunities," said Mr Dhanakorn, who is also president of La-Z-Boy Thailand Ltd and La-Z-Boy Asia Co Ltd, divisions of the US-based maker of easy chairs.
The TFIC aims to hold the TIF Expo in March every year, while the Thailand International Furniture Fair is planned for April.
Mr Dhanakorn said the stronger baht hurt the export market earlier this year. For branded furniture, manufacturers can revise up the selling price in line with the stronger baht, he said. For original equipment manufacturers, negotiations with customers can help.
"Our fierce competitor is no longer China but Vietnam, as wages there are lower than in Thailand at 150 baht a day compared with 350," Mr Dhanakorn said. "The Vietnamese government also supports the industry with attractive incentives."
In China, monthly wages are US$420 (13,205 baht) per person, compared with $350 in Thailand. The Chinese government has also revoked some incentives.