Bangkok: The National Economic and Social Development Council (NESDC) reports that while production costs in Thailand remain elevated, the pressure is beginning to ease in alignment with declining global energy prices.
According to Thai News Agency, the Trade Policy and Strategy Office (TPSO) has announced that the Producer Price Index (PPI) for June 2026 still indicates high production costs, despite the easing trend influenced by global energy price reductions. The PPI is projected to experience slower growth in the third quarter, with government economic stimulus measures anticipated to bolster domestic demand and aid the recovery of some manufacturing industries.
Mr. Nantapong Chiraleartpong, Director of the Trade Policy and Strategy Office, highlighted that the PPI for June 2026 was recorded at 114.3, marking a 7.2 percent increase compared to the previous year. This growth rate represents a deceleration from May's 8.5 percent expansion, driven by agricultural and fisheries products, mining products, and industrial products. The high energy price base from last year has contributed to sustained production costs across various industries, despite the recent decline in global energy prices.
In the agricultural and fisheries sector, there was a 3.7 percent increase, attributed to rising paddy rice prices from a low base last year, and increased fresh cassava prices due to reduced market supply. Rubber prices saw an uptick owing to heightened demand for alternative raw materials, while fresh palm fruit prices rose in tandem with global palm oil prices. Conversely, prices for several fruits, including durian, mangosteen, and coconut, decreased due to high supply and lower end-market prices. Furthermore, prices for live pigs, live broiler chickens, and Vannamei shrimp fell as consumer demand slowed amid the economic downturn.
The mining products sector experienced a significant 25.5 percent increase, driven by elevated prices for crude oil, natural gas, and metal ores compared to the previous year. This was exacerbated by supply risks linked to Middle Eastern conflicts and rising energy and transportation costs. The industrial products category saw a 7.2 percent rise, with notable increases in refined petroleum products, chemicals, rubber and plastic products, computer and electronic products, and gold, reflecting global market trends and demand for safe-haven assets.
Looking ahead to the third quarter of 2026, the PPI is expected to continue its upward trajectory, albeit at a reduced pace, in alignment with declining global energy prices. Despite ongoing high energy and transportation costs, competitive pricing in domestic and export markets is constraining businesses' capacity to transfer costs to consumers, thus alleviating cost pressures.
Government stimulus measures targeting domestic consumption are anticipated to stimulate demand and support the recovery of manufacturing activities in select industrial sectors during the third quarter.