Thailand Industrial Output Growth Beats Forecasts

Thailand’s industrial production expanded 4.44% year-on-year in August 2026, surpassing expectations for a 1% rise and marking the second straight month of increase. The increase was boosted by higher electronic output, government stimulus, and a weaker baht. Communication equipment surged 24.41% year-on-year, driven by AI-related demand and data center infrastructure. Supakit Boonsiri, head of the ministry's industrial economics office, said the ministry had revised its manufacturing production index (MPI) methodology, adding new electronics products and changing the weightings to reflect the country's new economic structure. Thailand’s Industry Ministry revised its forecast for factory output growth to a range of 2.75% to 3.55% in 2026 (up from the previous 0.0–0.5%) and industrial GDP growth to 0.8%–1.8% (up from the previous 0.75–1.75%). .

Thailand’s industrial production unexpectedly grew 0.46% yoy in July 2026, recovering from a downwardly revised 2.38% decline in June, beating expectations for a 1% fall and marking the first increase in four months. The rebound was mainly driven by industries aligned with technological trends, particularly the electronics sector, which expanded alongside the growth of AI and digital infrastructure, with computer and peripheral production surging 28.23%. Meanwhile, petroleum refining products rose 9.12%, and sugar jumped 28.30%. However, the conflict in the Middle East remains a factor requiring close monitoring, as it contributes to energy price volatility and raises production and logistics costs for the industrial sector. Furthermore, a slowdown in foreign tourism could affect related sectors, such as the food and beverage industry. Thailand’s Industry Ministry revised its forecast for factory output growth to a range of 0.0% to 0.5% for 2026, from 1.0% to 2.0% previously.

Thailand’s industrial production fell 3.10% year-on-year in June 2026, following an upwardly revised 1.30% decline in May, marking the third consecutive month of contraction. It was the steepest decline since last November, amid higher oil prices and rising freight costs due to disruptions caused by the Middle East conflict. The decline was mainly driven by weaker production of automobiles (-12.59%), petroleum products (-7.97%), and apparel (-8.99%). Latest data showed that car production fell 7.55% from a year earlier in June. Meanwhile, palm oil production also slumped 33.2% year-on-year. However, continued growth in demand for electronics and technology-related products helped limit the decline, with production of computers and peripherals rising 2.5%. For the first half of the year, industrial production fell 0.4% from a year earlier. Thailand's Industry Ministry maintained its forecast for factory output growth of 1.0% to 2.0% this year. Monthly, industrial output fell 2.37%.