Thailand Trade Balance June 2020


Thailand: Merchandise exports fall at steeper rate in June

July 23, 2020

Merchandise exports dived 23.2% over the same month last year in June (May: -22.5% year-on-year). June’s outturn marked the largest fall since July 2009 and was spearhead by both tumbling agricultural and jewelry exports, and a significant base effect. Meanwhile, merchandise imports slid 18.0% over the same month last year in June (May: -34.4% yoy).

As a result, the merchandise trade balance deteriorated, recording a USD 1.6 billion surplus in June having clocked a USD 2.7 billion surfeit in May (June 2019: USD 3.3 billion surplus). Lastly, the trend pointed down, with the 12-month trailing merchandise trade balance recording a USD 16.2 billion surplus in June, compared to USD 17.9 billion surplus in May.

The ongoing pandemic will weigh heavily on the overall economy this year, as fragile external demand weighs on exports, and diminished domestic activity and supply-chain disruptions impair imports. The prolonged nature of the outbreak, a slowing of the Chinese economy and uncertainty regarding future demand for Thai products all tilt risks to the downside.

Commenting on this month’s reading, Prakash Sakpal, senior economist at ING, commented:

“Recovery is nowhere in sight just yet given that worsening Covid-19 situation globally foreshadows a prolonged weak export demand ahead. Adding to the length of recovery is drought across the country that’s hurting the agriculture production and exports. Earlier this week the Thai Rice Exporters Association cut its export target by 13% to 6.5 million tons, the lowest annual volume in two decades that could displace Thailand from its position as the world second-biggest rice exporter.”

FocusEconomics panelists project exports to contract 9.4% in 2020 and imports falling 14.3%, which would bring the trade surplus to USD 34.7 billion. In 2021, exports and imports are expected to increase 6.1% and 7.8% respectively, with the trade surplus narrowing to USD 33.6 billion.

Author:, Economist

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Thailand Trade Balance Chart

Thailand Trade12 June 20 20

Note: 12-month sum of trade balance in USD billion and annual variation of the 12-month sum of exports and imports in %.
Source: Bank of Thailand (BoT) and FocusEconomics calculations.

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