Thai industrial production reaches 2-year high in March

[webfact]

Industrial production reaches 2-year high in March

BANGKOK, 24 April 2015 (NNT) – According to the Office of Industrial Economics (OIE), industrial manufacturing in March broke its two-year record, leading to a projection that the annual growth of industrial exports will exceed 2 percent.

Based on an assessment of private industrial operators’ production in March, Director of the OIE Udom Wongviwatchai disclosed that the overall productivity was standing at 71 percent of the full capacity, surpassing that of February and reaching the highest in the past two years. The director ascribed the production peak to remarkable recovery in the domestic market, coupled with more robust spending brought about by the thriving tourism sector.

Considering such improvement, Mr Udom projected that the manufacturing production index (MPI) of 2015 will expand 3-4 percent while the growth of industrial GDP will reach 2-3 percent.

This year’s industrial exports also have better outlooks than last year, with growth estimated at 2 percent. More exports are being seen in such industries as automobiles, electronics and electrical appliances. Imports of raw materials and machinery, meanwhile, have also been expanding for 7-8 consecutive months and will likely help boost production over the next month or two.

Mr Udom added that more factory openings and production base expansion will be seen in the latter half of the year than the first half. He cited the commencement of the government’s mega projects as a crucial factor driving more investments into the industrial sector.


-- NNT 2015-04-24

[Strangebrew]

Thai debt at all time high defaults rising at a fast pace More Thai's unable to make ends meet. Vacant condo's in the thousands as expats rush to leave the country To neighboring countries. Where land ownership is allowed. One got to think something wrong with Thai's eyesight and hearing. Expats been saying for years Thai baht exchange rate to low. Exports down, investments down, Only thing for sure is this when boat has leak in time it will sink. EU yellow carded Thailand US slowing imports from Thailand, China exploiting Thai greed for there own gain, with the train thru Thailand for ports in where ? you guessed it Burma not Thailand. So think who is your friend?

[Lupatria]

And they pile up all their goods and dream of the times to come when the Thb is down to a competitive level. tzzzzzzzzzzzz

[Srikcir]

"industrial manufacturing in March broke its two-year record, leading to a projection that the annual growth of industrial exports will exceed 2 percent."

This statement is either incredibly naive, stupid, or a miscalculation.

Exports are almost flat for 2015Q1 and likely to continue into 2015Q2 The outlook for 2015Q2 for internal growth made this week is not encouraging (The Nation 2015-04-24):

"The recovery of the grassroots is sluggish and that is something to be worried about," he [chief executive officer of Asia Plus Group Holdings Securities, Kongkiat Opaswongkarn] said."

"The chairman and chief executive officer of Asia Wealth Securities, Pichit Akrathit, said capital from government investment was still not there and investors were waiting to see clarity in the government's investment plans while household debt, lower crop prices and uncertainty over future income were hindering internal consumption."

But what Thailand will experience are bloated inventories from excess manufacturing capacity. It will either have to heavily discount those inventories or "junk" them with no buyers. The industry sector will need to reduce manufacturing capacity by laying off workers and either cutting back manufacturing or shutting down plants.

Edited April 25, 2015 by Srikcir

[Cake Monster]

Thailand will very soon not even have to make these statements about Industrial production, as there will be little production to speak of.

Only today, the Thai Authorities are demanding Billions of baht in so called unpaid " back taxes " against 2 major Motor Vehicle Manufacturers with large plants here.

Only last week, one of those Manufacturers made an investment decision to establish two new plants away from Thailand ( 1 in Mexico and 1 in China ).

Will this kind of thing be the " new norm " for Thai manufacturing - possibly

[Balance]

Note that it was production that they said was up, not shipments. It is easy to raise production if that production is simply added to finished goods inventories. But when you are not selling what is being produced and you have to keep skilled labor, and you have the operating cash to pay the workers, then that is what is done. Just have to hope that it is not another hole that keeps getting deeper.