Thailand’s Export Challenges: Rising Freight Costs and Fiscal Strain

Thailand’s Export Sector Faces Pressure as Freight Costs Surge 30% Thailand’s export competitiveness is weakening as global freight costs rise by 30%, raising concerns over trade volumes and consumer prices, according to industry leaders. The surge in shipping expenses is disrupting supply chains and slowing trade flows, with food exports already showing a notable decline. Robin Loh, Chairman of the Singapore-Thai Chamber of Commerce and Country Director of Dawn Shipping, warned that end consumers will ultimately absorb these additional costs through higher retail prices. “Thailand is facing risks and uncertainty due to high freight costs, disrupted shipping routes and energy volatility, all of which are weakening export competitiveness. Logistics costs will rise and trade flows will slow further. Eventually, consumers will have to absorb these additional costs,” he said. Taking food exports as an example, export volumes fell by 10.5% in the first two months of 2026, according to the Federation of Thai Industries and the Thai Chamber of Commerce. This decline highlights the tangible impact of rising logistics costs on key sectors of Thailand’s economy. To address these challenges, Loh emphasized the need for government action to streamline processes at customs, ports, and in permit issuance. Complex regulations have undermined the country’s regional competitiveness, and simplifying procedures could help mitigate some of the pressures from external factors. He similarly pointed to the growing importance of artificial intelligence and digitalisation in improving export-import efficiency. “The Thai government could glance at how neighbouring countries are adapting and adopt best practices. In global trade and during periods of crisis, countries that provide efficiency through new technology will be best positioned to deliver for their people,” Loh added. While the United States and Iran have reached a two-week ceasefire, ongoing uncertainty continues to disrupt shipping routes and supply chains, contributing to the volatile environment in which Thai exporters operate. The combination of elevated freight costs, geopolitical risks, and supply chain disruptions is creating a challenging landscape for Thailand’s export-dependent economy.