March 19, 2010
The private sector had expressed concerns about the continued Baht appreciation as it could hinder national export.Minister of Commerce, Pornthiva Nakasai, disclosed that the private sector was concerned about the continuation of the Baht appreciation and called on the government to closely monitor the currency in order to prevent excessive Baht volatility which could cause a loss in export competition. She also said that if the Thai Baht appreciates, it could slow trade negotiations and hinder export sales from the second quarter of this year.
However, Ms Pornthiva strongly believed that it would be a short term effect as the Bank of Thailand (BOT) and the Ministry of Commerce could possibly control the Baht appreciation. Nevertheless, she said the ministry had not yet made further adjustments for the export target. The country’s export was expected to grow by 14% this year.
President of the Thai Rice Exporters Association, Chukiat Opaswong, stated that if the Baht value still appreciated at 33THB/USD, Thai rice exports in March are expected to decrease to 650,000 tons and 600,000 tons in April from 700,000 tons in the first two months of this year. White rice and Thai jasmine rice could not compete with ASEAN member countries in terms of price as Thai rice now stands behind the competitors by 200-300 USD per ton.
Thai exporters are now seeking talks with the ministry and the government to ask them to help curb the continuation of the Baht appreciation as the Baht value is now considered the highest amongst ASEAN countries. Such an issue could mainly influence the buyers’ decision and could possibly lead to contract terminations.