Thai food exports slightly declined in the first half of 2020 but demand is expected to jump back

The exports of Thai food products to China and the US have increased by 27 per cent and 14 per cent year-on-year during the first six months of 2020, the National Food Institute said on Friday.

However, the overall export of food products has slightly decreased by 2 per cent year-on-year to 505.6 billion baht in the same period.

Breaking down that number, the export of processed food has increased by 0.1 per cent to 238.9 billion baht but the export of non-processed agricultural products have decreased by 3.7 per cent to 266.7 billion baht.

The exports of ready-to-eat products, canned-tuna, spices, and fresh and processed chicken have increased by 15.8, 10, 6.6, and 2.1 per cent respectively.

Nevertheless, the exports of coconuts, rice, shrimp, sugar, tapioca starch have decreased by 15, 14.9, 13.2, 12.8, and 12.2 per cent respectively. The drop is mainly to lower demand from hotels and restaurants during the strict lockdown period in the first half of the year.

The export of coconuts to the US and Europe have been hit by the western world’s claims that Thailand’s usage of monkey to pick coconuts is cruel to the animals.  

“The export of Thai food products is expected to improve in the second half of this year,” said Anong Paijiprapapon, NFI’s President.

The exports of Thai food products have contracted by 9.1 per cent during the first quarter but then bounced back to an expansion of 4.9 per cent in the second quarter.

With an increased in demands from trading partners, Anong said the exports of Thai food products could increase by 3.6 per cent in the second half of 2020, based on the assumption that the baht will be trading around 31-32 baht per US dollar.

This would make up to an expansion of 0.8 per cent with a value of 1.03 trillion baht by the end of the year.

The exports to China, the US and Oceania have increased by 27.4, 14 and 8.5 per cent respectively in the first half of 2020.

However, the exports of Thai foods to Africa, the Middle East, Europe and ASEAN have dropped by 33.3, 12.5, 11.4, and 7.4 per cent respectively.  

On the global outlook, the export of food products has increased by 0.8 per cent and was valued at US$645 billion in the first half of 2020, the NFI said.

They expect the expansion to be better in the second half as more and more countries are easing up on their lockdown and businesses are reopening. Demand from China is expected to lead the expected “jump” in demand, Anong added.

She said that the exports of Chicken, canned-tuna, spices, ready-to-eat products, and pineapple will continue to do well in the second half of this year.

But, the exports of rice, sugar, tapioca starch, shrimp, and coconuts are expected to continue to drop in the second half, she added.

The Bank of Thailand expects Thailand’s total export value to drop by at least 10 per cent down to $221.64 billion, contributing to an expected recession of at least 8 per cent in 2020.

In comparison, Thailand shipped out more than $246.27 billion worth of products in 2019 which was already 2.6 per cent less than in 2018.

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