- Export volume of agricultural commodity started to decline. In Q4, export value of agricultural commodity dropped by 19.6 percent as a result of 20.7 percent reduction in export volume while export price picked up by 1.4 percent. Agricultural export that recorded volume reduction are including (i) Rice, due to importing countries switched their orders to cheaper low grade rice in Vietnam, Pakistan and India meanwhile Thai rice price was higher than world market price. (ii) Cassava, due to the decline in domestic production (iii) Rubber, due to the decline in import demand from China which are the main importer and a downturn in automotive industry stemmed from the reduction of car sales.
(%YOY) 2008 (%YOY) Export share Export share by destination
Year Q1 Q2 Q3 Q4 in 2008 Major market others
Electrical machinery 0.7 10.0 12.6 6.2 -21.8 17.5 75.2 24.7
computer and part 6.1 18.8 20.8 9.2 -18.0 10.3 78.0 22.0
Electrical circuit -14.0 -6.2 -4.1 -4.9 -39.2 4.1 68.2 31.8
Electrical appliances 6.1 14.2 14.3 16.1 -17.3 10.1 65.3 34.7
Radio and Television 2.6 1.5 5.3 22.9 -18.4 1.8 57.6 42.4
Clothes 1.2 1.5 1.3 3.9 -2.0 1.7 84.1 15.9
Furniture and part -3.8 -1.7 3.4 -2.0 -14.1 0.7 75.2 24.9
Canned food 23.4 20.5 34.1 28.4 13.2 2.2 60.2 39.7
shrimp 4.9 -7.2 1.1 12.3 8.5 0.7 81.2 18.8
chicken 62.5 66.3 69.2 70.4 48.9 0.9 97.1 2.1
- The decline of manufacturing export value was broad-based. In Q4, export value of manufacturing products plunged by 7.8 percent due to the 12.0 percent reduction in export volume but export price increased by 4.8 percent. Export value of high technology products (which is accounted for 68 percent of total manufacturing export and 61 percent of total export value) declined by 13.8 percent. Export value of labor-intensive products and resource based products expanded by 9.4 and 11.4 percent respectively. Commodities that recorded a decline in export value are including electrical appliances, computer and part thereof, plastic and resin products, petroleum products, vehicle parts, garments and furniture. Commodities which recorded a slowdown in export value are including rubber products, cars, paper products, toys and sport requisites, gems and jewelry. The increase in export value of gems and jewelry was driven by the increase in export value of gold. By netting out of gold, the export value of gems and jewelry declined by 30.6 percent, which is attributable to the recession in the US.
- Export markets: The value of export to both major and other markets declined. In Q4, export to every major market declined. Export to Japan and the US contracted by 4.7 and 10.2 percent respectively. Export to Asian and European union decreased by 15.9 and 7.4 percent respectively. Export to other market also declined such as China (-24.2 percent) Hong Kong (-16.7 percent), Taiwan (-29.9 percent). However, export to India and Middle East recorded expansion rate of 28.7 and 5.4 percent respectively.
For the whole year export value in dollar terms increased by 16.8 percent as export volume and price picked up by 10.5 and 5.5 percent respectively. In baht terms, export value expanded by 12.8 percent and export price increased by 6.6 percent. In sum, export value of agricultural and manufacturing commodities increased by 35.0 and 16.5 percent respectively.
Key Export Market
2007 ---------------- 2008 -----------------
(%YOY) year year Q1 Q2 Q3 Q4 %share Major Market 11.8 14.2 18.2 26.5 26.2 -10.8 57.2 USA 12.6 11.4 8.2 9.7 15.7 -10.2 11.4 Japan 11.8 11.3 7.7 21.0 25.0 -4.7 11.3 EU (15) 12.8 12.0 16.1 13.0 15.7 -7.5 12.0 Asian (9) 21.4 22.6 32.8 48.4 39.4 -15.9 22.6 Others 25.9 20.8 30.8 31.0 31.3 -5.3 42.8 Hong Kong 5.6 5.6 49.9 37.6 12.5 -16.7 5.6 Taiwan 2.2 1.5 -26.0 -12.3 -3.3 -29.9 1.5 South Korea 1.9 2.1 17.2 15.4 63.6 1.1 2.1 Middle East 4.9 5.3 26.4 33.2 48.1 5.4 5.3 India 1.8 1.9 24.5 32.4 25.5 28.7 1.9 China 9.7 9.1 34.7 22.1 14.7 -24.2 9.1 Source: Bank of Thailand
- Imports: slowdown noticeably in line with the deceleration in exports and domestic demand. In Q4, import value in dollar terms picked up by 5.3 percent, noticeably decelerated from 35.0 percent, 28.7 percent and 39.1 percent in Q1, Q2 and Q3 respectively. Import value slowed down in all import categories except for raw material & semi-finished goods that declined in line with export contraction and the slowdown in domestic demand. Overall, import volume increased by 3.2 percent while import price continued to increase but at a slower pace of 2.1 percent due to the decline in oil price. In baht terms, import volume expanded by 8.1 percent and import price picked up by 4.7 percent.
- Import of capital goods decelerated both in volume and value: In Q4, import value expanded by 4.5 percent in tandem with the contraction of domestic investment brought about by global economic downturn. Import goods that recorded an expansion in its import value are including machinery and parts, metal products, other capital goods. In contrast, import value of electrical machinery and computer & part thereof. Over all, import volume of capital goods in Q4 increased at a sluggish rate of 1.7 percent while import price rose by 2.7 percent.
- Imports of semi-finished goods and raw materials declined both in volume and value terms. In Q4, Import value of raw materials and semi-finished goods dropped by 1.9 percent in line with the contraction in export and the slowdown in domestic demand. Import goods that recorded a decline in its value are including electrical and electronic appliances, other metal ores, metal waste, chemical products and fertilizer and rubber. However, import value of metal and gold showed a robust rate of expansion in particular import value of gold. This was attributable to the increase in speculative demand as gold price declined in Q4. Overall, import volume of semi-finished goods and raw material plunged by 8.0 percent while import price increased by 6.6 percent.
- Imports value of fuel and lubricant decelerated in line with the decline in oil prices. Import value of fuel and lubricant expanded by 6.1 percent as import volume picked up by 21.2 percent and import price noticeably declined by 12.5 percent. The deceleration in import value of fuel and lubricant was mainly attributable to the decline in world market oil prices as indicated by a reduction in import value of crude oil (import volume rose by 16.6 percent but import price dropped by 9.5 percent) as well as a contraction of import value of petroleum products of 56.5 percent.
- Import value of consumer goods slowed down: Import value of consumer goods increased by 2.6 percent, noticeably decelerated from 33.1 percent in Q3. This was attributable to concerns over economic prospects which eventually deferred consumption decision. Import goods that record a reduction in its import value are including miscellaneous goods, medicine and pharmaceutical products, gems and jewelry, clothing, shoes and other garments. Meanwhile, the import value of electrical appliances, watch and parts, milk and diary products declined. In sum, import volume and import price of consumer goods increased by 1.6 and 1.0 percent respectively.
For the whole year of 2008, import value in dollar terms picked up by 26.4 percent with the increases in import volume and import price of 12.2 and 12.6 percent respectively. In baht terms, import value and import price increased by 22.1 and 8.8 percent respectively.
- Term of trade improved as export price in Q4 picked up by 4.6 percent while import price increased at a slower pace of 2.1 percent. Thus, changes in relative price improved term of trade in Q4 by 2.5 percent in contrast with a reduction of 0.8 percent in Q3.
- Trade balance recorded a deficit of 1,365 million USD (which is equivalent to 47,201 million baht) larger than a deficit of 180 million USD in Q3. However, for the whole year of 2008, trade balance registered a surplus of 237 million USD which is equivalent to 6,027 million baht.
- Current account continued to record a deficit. Net service, income & transfer in Q4 registered a deficit of 607 million USD which was partly a result of the shutdown of Suvarnabhumi and Don Muang Airports between 25th November and 3rd December 2008 that substantially eroded tourism revenues. Combined with trade balance deficit in Q4, current account balance was in deficit of 1,971.5 million USD (equivalent to 68,338 million baht). For the whole year of 2008, current account registered a deficit of 178 million USD which is equivalent to 10,393 million baht.
(Continue to).../-Production in Q4 Of 2008..