Thailand: Baht appreciation erodes cement export growth

Thailand: Baht appreciation erodes cement export growth
Published: 02 August 2007

During 1H07, Thai cement export value in US dollar terms rose to US$279mn, up 9.4% YoY as thriving demand in Asia and Europe helped offset the slow down in the US market (largest Thai export market in 1H06). Nevertheless, Thai cement export value in baht terms was stable YoY at Bt10bn in 1H07 due to the appreciation of the baht against the US dollar of approximately 10% YoY to Bt33/US$1.

The rise in export volume could only maintain the utilization rate in the cement sector, not cement margins, amidst slow domestic demand.

In the longer term, domestic demand is expected to recover in late 2007 following an improved Thai economic outlook and export demand to continue to flourish.