On April 30, 2025, Mr. Poonpong Naiyanapakorn, the Director-General of the Trade Policy and Strategy Office (TPSO), announced that Thailand's export price index for March 2025 stood at 111.0, reflecting a decrease of 0.6% compared to the same month last year. This marks the third consecutive month of declining growth, primarily driven by lower prices in certain agricultural products due to increased production and falling global crude oil prices. Despite this, the industrial goods sector provided a significant boost, with an increase of 1.5% led by gold, which saw heightened demand as a safe-haven asset amid global economic uncertainties.
The export price index's decline was notably influenced by a 10.1% drop in the mineral fuels and lubricants category, particularly refined oil, which mirrored the downward trend in global crude oil prices. Additionally, the agricultural sector experienced a 2.9% decline, largely attributed to excess supply of rice and cassava, as well as decreasing demand from China. In contrast, the industrial goods sector showed resilience, with significant increases in electronic goods, particularly computers and components, which surged by 1.3% due to the rising demand for new technology.
On the import side, the index reached 114.3, a 2.8% increase year-on-year. This growth was primarily driven by a rise in consumer goods, which increased by 8.1%, including household electrical appliances, pharmaceuticals, and jewelry. The capital goods category also saw a 4.6% increase, driven by demand for computers and machinery, reflecting the ongoing expansion in the digital and electric vehicle industries.
However, the most significant decrease was seen in raw materials, which fell by 10.1%, primarily due to the decline in mineral fuels. This trend is concerning as it indicates potential vulnerabilities in Thailand's trade balance, particularly as the global economic landscape remains uncertain.
According to Mr. Poonpong, the outlook for the export and import price indices in the second quarter of 2025 is expected to slow compared to the first quarter. This slowdown is attributed to rapidly changing global trade conditions and ongoing geopolitical tensions. Nonetheless, several factors may support continued growth in export and import indices, including a low comparative price base from 2024 and the ongoing demand for processed agricultural products.
Moreover, the Thai economy faces several risks that could impact future growth. These include the potential for a global economic slowdown, geopolitical conflicts, trade policy uncertainties, and agricultural price fluctuations stemming from overproduction. The strengthening of the Thai baht may also pose challenges, as it could affect the competitiveness of Thai exports in international markets.
In a broader context, Thailand's export value for March 2025 reached $29,548.25 million, marking a year-on-year increase of 17.8%. This growth is the highest recorded in three years, exceeding earlier forecasts from SCB EIC, which had estimated a growth of 14.7%, and a Reuters Poll predicting 13.5%. The strong performance in exports continued from previous months, with 14% growth in February and 13.6% in January, leading to an overall export growth of 15.2% in the first quarter of the year.
The significant increase in exports was bolstered by a surge in demand for electronics, with exports to the United States skyrocketing by 34.3%, the highest growth in over three years. Notable contributors to this growth included computers and components, which expanded by 107.2%, and fax machines and phones, which grew by 44.4%. Exports to China also performed well, increasing by 22.2%, particularly for intermediate and capital goods such as rubber and aluminum products.
Gold exports played a crucial role in March 2025, with unrefined gold exports soaring by 269.5% compared to the previous month, driven by heightened demand for gold as a hedge against global economic risks. Markets in Switzerland, Cambodia, Hong Kong, and the United Arab Emirates saw substantial growth in gold imports, reflecting a global trend of increasing gold demand.
Despite these positive indicators, the agricultural sector has faced challenges, with a 0.5% decline in agricultural exports. This decline is partly due to reduced demand for fresh fruits and vegetables, as well as ongoing issues with rice and cassava exports. The industrial agricultural sector also contracted for the first time in nine months, primarily due to decreased demand for pet food and processed foods.
Furthermore, the Manufacturing Production Index (MPI) for March 2025 stood at 105.03, showing a decrease of 0.66% compared to the same period last year, although it increased by 9.21% month-on-month. The overall economic outlook remains cautiously optimistic, supported by government stimulus measures and the ongoing recovery in the tourism sector.
Key factors driving production growth include government initiatives aimed at stimulating the economy, such as relaxed credit regulations and various stimulus packages. These measures have contributed to a 17.8% increase in overall export value compared to the same month last year, marking the ninth consecutive month of growth.
As Thailand navigates through these economic fluctuations, the government and industry leaders emphasize the need for strategic planning and adaptability to mitigate potential risks and capitalize on emerging opportunities in both domestic and international markets.
