Domestic consumer tissue demand is outpacing Thailand`s home production capacity

Thailand has relatively low unemployment at 0.99% in 2019. Figure 2 shows the unemployment trend as a series of bars. While it did spike up in 2020 due to the pandemic, it was still considered at a relatively low level when compared to most other economies. In 2019, Thailand`s inflation rate was 0.7%, which again, is very low compared to most other countries. The inflation trend is shown in Figure 2 as a line. These statistics however tend to put Thailand in a relatively good position for consumer spending.

These economic and demographic factors have supported a relatively slow growth in domestic tissue consumption. This is reflected in the cautious growth of Thailand`s tissue machine fleet. The changing trend in the number of tissue machines is shown in Figure 3. Seven new machines were installed between 2013 and 2021, while only one was removed in 2017. Several tissue manufacturers are active with two or more mill sites in Thailand. Notable is the international company Kimberly-Clark, headquartered in the United States.

Thailand is very involved in international trade and runs a small positive trade surplus. However, the country tends to import more tissue than it exports. Figure 4 shows the tissue exports with a significant drop starting in 2018. Current tissue customers include Australia, Malaysia, Myanmar, and the United States.

Thailand`s tissue export trend shown in Figure 5 shows an interesting anomaly. The trend of imports shows a linear growth pattern that indicates that tissue machine additions have not kept up with domestic consumer tissue demand. However, the spike in imports from Indonesia seen in 2020 suggests a disruption in domestic mill production due to pandemic closures. In addition to Indonesia, China is becoming a significant tissue supplier to Thailand as well.