State agencies urged to take action on exchange rate

Relevant government agencies, including the Bank of Thailand, are being advised to take quick action to ensure the baht remains at an appropriate level.

- SOMHATAI MOSIKA LAMONPHET APISITNIRAN SOMRUEDI BANCHONGDUANG

Ongart Kittikhunchai, president of the Thai Food Processors' Association, said the central bank must manage the exchange rate more actively rather than allowing it to be driven by external factors such as gold prices, cryptocurrencies and international developments.

He said the baht's appreciation has implications for all exporters, particularly those in the agricultural, agro-industrial and food sectors, with broader consequences for the national economy as exports account for 60-70% of GDP.

"If the baht continues to strengthen, it could affect business costs," said Mr Ongart.

"Exporters typically operate on single-digit margins, but the baht appreciated by 7-10% in 2025 and continues to strengthen."

He described the baht at stronger than 31 per US dollar as a dangerous scenario.

To cope with the situation, Mr Ongart suggested businesses focus on reducing operating costs by using technology to improve efficiency. Businesses must also negotiate with clients to raise product prices, as producers and exporters cannot continue supplying goods without price adjustments.

Dhanakorn Kasetrsuwan, chairman of the Thai National Shippers' Council (TNSC), said the baht's appreciation reduces export revenue by 5-10% when converted back into baht, depending on timing and contract terms. If prices cannot be increased, profits are directly eroded.

He said Thai products have lost price competitiveness against key rivals such as Vietnam, Indonesia and China.