The value of Thai outward trade for May fell for the third consecutive month to only 2.1 percent growth YoY. Excluding gold exports, May shipments contracted 2.8 percent YoY. Exports over 5M14 shrank 1.2 percent YoY or 2.4 percent YoY without gold shipments.
Agricultural/agro-processing exports continued to shrink by 2.6 percent YoY, led downward by rubber, refined sugar and canned/frozen/processed seafood. However, other categories, namely rice, frozen/processed vegetables and fruit, plus fresh/frozen/processed chicken, continued to perform fairly well. Meanwhile, industrial exports fell 2.1 percent YoY, most strikingly by electrical appliances, rubber products, construction materials and autos/related components, due in part to a low 2013 base. Steady growth was seen in shipments of jewelry, ornaments, gold, electronics, polymers and plastic products.
We at KResearch are of the view that Thai exports will begin to pick up in 2H14, growing perhaps 5.7 percent YoY. As a result, 2014 shipments may expand only 3.0 percent YoY, though close attention must be paid to global economic conditions, purchase orders from regular trade partners (especially those that are skeptical about labor issues in certain Thai industries) and the state of competitiveness in several Thai export categories.