Thai merchandise exports contracted in February, marking a fifth consecutive month decline. However, signs of recovery started to emerge.

According to SCB EIC, Thailand’s export value in 2023 is expected to grow by 1.2%, despite a continuous decline in February. However, there are signs of recovery as some markets, such as China and the Middle East, have improved their demand for Thai products.

The tourism sector and private consumption are also expected to benefit from China’s opening up, which is faster than expected. SCB EIC estimates that at least 4 million Chinese tourists will visit Thailand this year, boosting the businesses in the tourism supply chain.

The value of Thai exports in February 2023 was at USD 22,376.3 million, down by -4.7%YOY. Such growth marked a 5 consecutive months decline, with the contraction slightly decelerating from -4.5%YOY in January.

However, in terms of the seasonally adjusted month-on-month growth, exports in February improved by 3.8%MOM_sa, significantly improved from -3.0%MOM_sa in the prior month.

Furthermore, excluding gold (a product that does not reflect actual international trade conditions), Thai exports during the month contracted by merely -2.5%YOY compared to -4.4%YOY in January.

Exports of agricultural and agro-industrial products returned to an expansion…

In February, exports of major products started to show signs of improvement, in which

(1) Exports of agricultural products returned to growth for the first time in 5 months at 1.5%. The key products driving growth were fresh/ frozen/ dried fruits, with 95.0% growth primarily from exports to China, a sizable market with robust growth after COVID-19 curbs eased, in addition to boosts from the low base in the prior year. Other key drivers included Chilled or frozen poultry cuts, with 61.6% growth, up from 50.0% from the prior month.

(2) Exports of agro-industrial products also returned to growth for the first time in 3 months at 5.6%, after declining by -3.3% in January. The key products that boosted growth were exports of animal or vegetable fats and oils, which increased by 171.4%, improving from 124.0% in January. Similarly, exports of sugar returned to the first contraction in 3 months at 21.4%.

… while exports of principle manufacturing products continued to shrink.

(3) Exports of principle manufacturing products continued to contract for the fifth consecutive month at -6.2%, worsening from -5.4% in January. Such weakening growth was prompted by the slump in unwrought gold exports at -75.3%, compared to -14.8% in the prior month, as well as exports of plastic beads and chemicals product that continued to plummet for the eighth and tenth consecutive month, respectively. On the other hand, exports of other manufacturing products, including semi-conductors devices, transistors, and diodes, Electrical transformers and parts thereof, and motor cars, parts and accessories, continued to improve; and (4) Exports of mining and fuel products dropped by -10.0%, after increasing by 6.8% in the prior month, as exports of refined fuels decreased by -3.7% compared to 16.2% in January.

Read more : Flash / SCB EIC views that merchandise exports will expand by 1.2% in 2023 as signs of recovery emerge, despite a negative growth of exports in February | SCBEIC

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