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21 Aug 2019

Trading

July Thai exports resume growth as gold shipments surge, 3Q19 exports set to rise before the US imposes tariffs on China (Business Brief No.3815)

         Surging gold exports for the second consecutive month helped Thai shipments overall to resume growth for the first time in five months in July 2019.  The value of July shipments came in at USD21,205 million, increasing 4.28 percent YoY, driven partly by skyrocketing gold exports for the second consecutive month at 406.92 percent YoY as investors globally increased their holdings of gold, which is considered as a safe haven asset after the global economy experienced heightened risks stemming from the US-Iran geopolitical conflict and unresolved US-China trade dispute. Excluding gold exports, Thailand’s outward trade overall contracted 0.4 percent YoY in July 2019, led by shipments to ASEAN (9) and the EU while exports to major key trade partners, such as Japan, China and the US, reverted to high growth.

​            Thai exports to the US and China resumed growth in July 2019, due partly to the low base of last year (after the US began implementing trade barriers against China) and the fact that US manufacturers and import began restocking products before Washington raises new tariffs on Chinese imports towards the end of 2019. The increase was also attributable to increased supplies of agricultural products, such as longan, mongosteen, mango and durian, thanks to favorable weather conditions, and substantial growth seen in fresh, chilled, frozen and dried fruit exports to China. However, favorable July exports to the US and China do not indicate that our shipments overall will perform well during the remainder of 2019 because the accelerated restocking prior to the US tariff hike is considered a short-term factor.