Export prospects remain bright despite sundry risks
Operators are upbeat about the country’s export prospects but warn that the baht’s appreciation, escalating international conflicts and a looming container shortage could pose risks this year.
Ghanyapad Tantipipatpong, chairwoman of the Thai National Shippers’ Council, said exporters are facing a shipping container shortage. Shipping lines have cut their allotment of containers to Thai exporters after opting not to take on the transport costs of shipping empty ones to Thailand, she said.
The shipping container shortage has kept Thai exporters from delivering products to foreign buyers on time as agreed, said Ms Ghanyapad. She said the shortage is expected to be aggravated with inventory build-up from foreign traders intensifying from late last year until early 2017.
Ms Ghanyapad said the baht’s gains relative to those of its peers were also cause for concern. Ms Ghanyapad said if the Thai currency’s appreciation remains unchecked, it may affect production costs and the competitiveness of Thai exporters.
Nonetheless, the Thai National Shippers’ Council remains positive that Thailand’s exports will grow in a range of 2.5-3.5% this year, boosted largely by higher oil prices and higher farm product output on greater rainfall, boosting the shipments of agricultural and agroindustrial products.
Thai shippers raised their export growth forecast this month from an earlier forecast of 2-3% after the country’s export performance fared better than expected in the first quarter.
Ms Ghanyapad said exports are likely to continue their growth in the second quarter, as traders have been building up inventories that dropped sharply last year.
The council sees exports rising by 5% year-on-year in the second quarter.
The Commerce Ministry reported on May 22 that customs-cleared outbound shipments rose by 8.5% year-on-year in April to US$16.9 billion (576 billion baht) after a 9.2% jump in March.
Shipments fared well in almost all markets except the EU and the Middle East, which shrank 1.7% and 7.1%, respectively.
Exports of agricultural and agribusiness products rose 11.9% year-on-year in April, fetching $2.83 billion, boosted by higher shipments of rubber (+41%), sugar (+47%) rice (+22.7%), frozen shrimp (+6.6%) and seafood (+2.9%).
Exports of industrial products rose by 7.9% to $13.2 billion, led by chemicals (+30%), finished oil (+22.3%), electronics (+3%), and integrated circuits (+2.4%).
For the first four months of 2017, Thailand’s exports rose 5.7% to $73.3 billion, the highest rate in the past six years. Imports rose accordingly by 14.5% to $69.2 billion, yielding a trade surplus of $4.11 billion for the period.
The Commerce Ministry aims for export growth of 5% this year after a rise of 0.5% in 2016.