Record domestic orders push Thai manufacturing to 2-year high

Production soared despite weak exports.

Thailand's manufacturing sector continued its impressive expansion in November, driven by a record surge in domestic demand that more than offset weakness in export markets, according to the latest industry survey.

The S&P Global Thailand Manufacturing PMI rose to 56.8 in November from 56.6 in October, marking the seventh consecutive month above the 50.0 threshold that separates growth from contraction. The reading represented the sharpest improvement in manufacturing conditions in two-and-a-half years.

Record-Breaking New Orders

The standout feature of November's data was an unprecedented rise in new business inflows. Demand for Thai manufactured goods expanded at the fastest pace recorded since data collection began in December 2015, with manufacturers attributing the surge to better underlying demand conditions and growing customer interest.

This remarkable domestic performance came despite another decline in new export orders, which continued to face subdued external conditions. The contrast highlights the strength of Thailand's domestic market in supporting manufacturing growth even as global trade headwinds persist.

Production and Employment Rise

The sharp increase in new work drove a comparable rise in production levels. Thai manufacturers posted the second-fastest pace of output growth in two-and-a-half years as they worked to meet the surge in orders.

Firms hired additional workers to cope with higher workloads, though the expansion in workforce capacity remained modest. As a result, backlogged work accumulated again in November, with the rate of increase the second-sharpest on record, ranked just behind October's figure.

Purchasing activity also increased in line with higher new orders and production. However, stocks of purchases continued to fall as raw materials and semi-finished goods were depleted for production. Similarly, stocks of finished goods declined as outbound shipments for order fulfilment outpaced the replenishment of post-production inventories.

Price Pressures Remain Muted

Supply conditions stabilised midway through the final quarter of the year, marking an end to a year-long period of supply delays. However, reports of higher cost burdens led to the first recorded instance of input price inflation since June, though the rate of increase remained only fractional.

Crucially, goods producers opted to absorb cost increases and kept selling prices stable in November, a decision that is likely to support continued demand growth in the near term.

Business sentiment in the Thai manufacturing sector remained strongly positive in November. The level of confidence rose to its highest in just over two-and-a-half years amid hopes that business expansion plans and improvements in economic conditions will support higher sales in the year ahead.

Jingyi Pan, economics associate director at S&P Global Market Intelligence, said: "Thailand's manufacturing sector continued to expand midway through the final quarter of 2025, according to the latest S&P Global PMI data. The latest improvement in manufacturing sector conditions was driven by robust demand for goods from domestic sources. External weakness prevailed, however, as evident from another fall in new export orders in November.

"Overall, Thai manufacturers remained optimistic going into the end of the year. The record expansion in new orders, coupled with the near-record accumulation in backlogs of work, hinted at the likelihood for growth to continue in the coming months. The stabilisation of output prices also bodes well for demand growth in the near term."

The survey data suggests Thailand's manufacturing sector is ending 2025 on a strong footing, with domestic demand proving resilient enough to counterbalance international headwinds. The combination of surging orders, rising production and elevated business confidence points to continued expansion in the months ahead, provided the domestic market maintains its momentum.