Thailand posts record trade deficit as oil and China imports surge

Thailand posted what was described as a record trade deficit in April 2026, as surging imports of oil, capital goods and Chinese products outweighed another strong month for exports.

The Ministry of Commerce reported that exports in April were worth US$31.583 billion, up 23.1% from a year earlier, marking the 22nd consecutive month of expansion.

Excluding oil-related products, gold and military goods, exports rose 25.7%. Imports, however, climbed 45% to US$41.604 billion, leaving Thailand with a trade deficit of US$10.021 billion.

Export growth was driven mainly by electronics, automobiles, electrical appliances, and gems and jewellery, as importers accelerated orders to guard against price volatility, supply-chain disruption and expected cost increases.

For the first four months of 2026, exports expanded 18.9%, while imports rose 35.7% to US$147.250 billion.

Thailand’s trade deficit for January-April stood at US$19.497 billion.

Fuel imports jump as oil prices rise

April imports were led by six main categories.

Fuel imports reached US$8.389 billion, up 128.6% year on year.

Capital goods were worth US$10.384 billion, up 32.8%, while raw materials and semi-finished goods totalled US$17.607 billion, up 38.7%.

Consumer goods imports stood at US$3.490 billion, up 13%.

Vehicles and transport equipment reached US$1.186 billion, up 15%, while arms, military supplies and other goods were valued at US$546 million, up 44.3%.

Nantapong Chiralerspong, director-general of the Trade Policy and Strategy Office, said April’s record imports were driven by three main groups: raw materials and semi-finished goods such as integrated circuits and printed circuit boards, capital goods such as machinery, and fuel products.

He said higher imports of raw materials and capital goods reflected demand for production and re-export, supported by the growth cycle in global technology products.

Fuel imports, especially crude oil, rose sharply in value as global prices climbed because of the conflict in the Middle East. Nantapong said the 128.6% increase in fuel imports was significant and showed the pressure from energy costs. If energy prices remain high, Thailand’s import bill is likely to stay elevated.

Thailand’s China deficit widens

Thailand’s trade position with China and the United States moved in sharply different directions in April.

Thailand recorded a trade deficit with China of US$7.680 billion in April. For the first four months of the year, the deficit with China reached US$29.202 billion. Key imports from China included electrical machinery, components and mechanical equipment.

By contrast, Thailand posted a trade surplus with the United States of US$4.648 billion in April. The surplus for the first four months stood at US$21.519 billion.

Export outlook remains mixed

The ministry expects Thai exports in 2026 to continue expanding despite prolonged geopolitical tensions, supported by the ability of exporters and shipping lines to respond quickly to changing risks and adjust to higher costs.

The ministry’s export forecast for 2026 remains in a wide range, from a contraction of 3% to growth of 8%. If exports grow by 8%, their value would reach US$366.805 billion. If they fall by 3%, export value would be US$329.416 billion.

Under the base-case scenario, exports are expected to grow 3% to US$349.824 billion. To achieve that, average monthly exports from May to December must reach at least US$27.758 billion.

The best-case scenario of 8% growth would depend on the ability of exporters and shipping operators to manage geopolitical uncertainty and adapt quickly to higher costs.

However, risks remain. These include rising sea freight costs, continuing tension around the Strait of Hormuz, and drought linked to El Niño, which could affect agricultural output in the second half of the year.

Chinese goods and costly oil deepen pressure

Assoc Prof Dr Aat Pisanwanich, an independent academic and expert in international economics and Asean affairs, said Thailand’s 45% jump in April imports was driven by three main factors.

The first was China’s policy of redirecting more exports to Thailand and Asean after its shipments to the United States fell sharply during the trade war, particularly under Donald Trump.

Dr Aat said Chinese exports to the US had contracted by 40-50%, prompting China to push more goods into Thailand and the wider region.

He expects Thailand’s trade deficit to widen further this year, especially with China.

The second factor was Thailand’s rising oil-import burden. Although import volumes may not have changed significantly, higher global oil prices caused by Middle East tensions have pushed up the value of energy imports.

Dr Aat said Thailand relies on overseas sources for nearly 95% of its oil, with around 60% coming from the Middle East. The country also depends on imported natural gas for about 30% of its needs, leaving the Thai economy directly exposed to geopolitical volatility.

The third factor was Thailand’s lack of sufficiently strict import-control measures. This has allowed foreign goods, especially Chinese products, to compete more aggressively with Thai businesses.

Dr Aat said small and medium-sized enterprises were under pressure from high energy and electricity costs, making it difficult for them to compete on price. Some businesses may choose to import goods for resale instead of producing them locally, while others could be forced to shut down.

“Thailand is likely to continue running a trade deficit next month because global oil prices remain above US$100 per barrel amid uncertainty over Iran and the United States, while futures contracts still reflect high energy costs ahead,” he said.

Calls grow for energy and trade restructuring

Dr Aat said the government should accelerate campaigns to promote Thai-made goods and require foreign direct investment projects that set up production bases in Thailand to use more domestic raw materials and locally produced goods.

He also urged stricter checks on false origin claims, tighter monitoring of imports used for re-export, and higher standards for inspecting imported goods.

At the same time, he said Thailand should move more quickly to restructure its energy system, reduce dependence on Middle Eastern oil, and seek new energy sources from Russia, Africa and Central Asia.

He also called for a serious push into renewable energy to reduce long-term risks from volatile energy costs.

“Over the past 10 years, Thailand has run deficits from imported goods, but in 2026 the added factor is the sharp rise in oil import costs, which has pushed the trade deficit much higher,” Dr Aat said.