Thailand recovers from devastating floods

Thailand’s recovery from the floods has seen a historic reversal of inbound and outbound traffic.


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Thailand recovers from devastating floods

Thailand’s recovery from the floods has seen a historic reversal of inbound and outbound traffic. Thailand’s gateway airport, Suvarnabhumi, usually has been export led by a margin of fractionally over two to one as major industrial estates near Ayutthaya, just north of the capital Bangkok, turned out a large part of the world’s hard drives and other high tech products, as well as automotive. However flooding at five of these seven estates punched a hole in exports as water up to two metres deep forced factories to close. “In November this (ratio) changed to exports at 54 per cent and imports at 47 per cent and the trend is continuing so far this month,” said Stewart Sinclair, managing director of Bangkok Flight Services. It also has a punched a major hole in the fortunes of a number of airfreight companies with business lost estimated at between a fifth and nearly all, according to a number of sources Payload Asia spoke to. “Outbound is very low for us. We are doing 10 per cent of what we normally do as we are linked to the hard drive business,” said one executive with an international freight company who asked not to be named. What has staved off disaster has been the willingness of companies, especially in the automotive sector, another big player in Thailand’s industrial base, to import in order to keep production lines humming. These had previously been supplied by in-country suppliers. “What we are seeing now are large volumes of parts being imported to serve these assembly plants hence the increase in imports,” said Sinclair. This has helped sustain Suvarnabhumi although its management company, Airports of Thailand, admits it has taken a hit. October volumes were down 4.55 per cent year on year and those for November down by the higher margin of 8.25 per cent an AOT official told Payload Asia. Statistics gleaned from AOT’s website show in November 2010, Suvarnabhumi moved 62,911 tonnes of cargo an increase of 11.1 per cent on 2009’s total of 56,638 tonnes. What is now emerging in the Thai capital is a two fold consensus. Few see any real or long-term damage to the air cargo sector, but expect there to be several months of fretting as factories are restored to full working order and the traditional balances at Suvarnabhumi return. “The industrial estates to the north are now dry and limited manufacturing has already started but it is likely to be several months before they are able to reach full production because of the damage to machinery and IT,” said Sinclair. “We expect the current trend to continue for the next two to three months until the factories are fully operational again and then the mix of exports and imports should revert back to historical levels.”