June 19 (Bloomberg) -- Thailand’s exportsfell the most since at least 1992 in May as the global recession eroded demand for products. The decline may moderate as manufacturers buy more parts to ship abroad.
Shipments dropped 26.6 percent from a year earlier to $11.7 billion, the Commerce Ministry’s Permanent SecretarySiripol Yodmuangcharoen said. That’s the steepest slide since Bloomberg began tracking the data and compares with a 26.1 percent contraction in April. Imports retreated the least in six months.
“The decline has stabilized and, looking at other economic indicators, exports may improve,” said Nuchjarin Panarode, an economist at Capital Nomura Securities Pcl in Bangkok, adding she expected the magnitude of the contraction.
The slide in shipments, which account for about 70 percent of the economy, may ease in the coming months as manufacturers including Hana Microelectronics Pcl and KCE Electronics Pcl ship more products. Thailand’sindustrial output fell the least in five months in April as exporters’ customers started rebuilding stockpiles in anticipation of improving demand.
Imports fell 34.7 percent to $9.25 billion as manufacturers bought more components used to build exports. The drop follows a 36.3 percent slide in April. The trade surplus in May widened to $2.41 billion from a $595 million excess a month earlier.
‘Light at the End’
Thailand’s SET Index of stocks climbed 3.3 percent in Bangkok, trimming its weekly loss to 6.3 percent. The baht was little changed at 34.16 against the dollar.
A pickup in export orders boosted manufacturing output in April, Amara Sriphayak, a Bank of Thailand official, said on May 29. Richard Han, chief executive officer at Hana, said the same day that demand had accelerated in May from April.
“We are still walking in a tunnel but we have started to see the light at the end,” said Kanit Sangsubhan, director of the Finance Ministry’s research institute and a Bank of Thailand board member. “Demand from China and the rest of Asia will help our exports.”
“We don’t think it will worsen the economy in the second quarter because imports remain low, which will be positive for net exports,” said Capital Nomura’s Nuchjarin.
Thailand’s economy shrank 7.1 percent in the first quarter after a collapse in exports. Prime Minister Abhisit Vejjajiva said on June 9 “the worst is behind us” and he expects GDP will return to annual growth in 2010.
Exports may contract between 15 percent to 19 percent this year, Siripol said today. Shipments may continue to decline in the third quarter and return to growth in the last three months of 2009, he said.