Thai factory output down in Sept

BANGKOK, Nov 3 (Reuters): Thai manufacturing output fell 0.5 per cent in September from a year before due mainly to weak global demand, the industry ministry said Thursday, and it will suffer more in coming months because of floods that hit industry hard from October. The flooding has forced seven big industrial estates to close, affecting thousands of factories. It could take months for them to fully resume operations. "September output was already down while several industrial estates are still under water," Aphiwat Asamaporn, deputy director general of the ministry's office of industrial economics, said in a statement. Factory output in August rose a revised 6.8 per cent from a year before. Economists in a poll had forecast an increase of 3.0 per cent for September. Compared with August, output rose 2.2 per cent. Output of hard disk drives dropped 6.9 per cent in September from a year before as global demand slowed, while production of electronic tubes fell 7.6 per cent. The flooding was expected to hit output further in these sectors for the rest of the year, the ministry said. Car production rose 28.2 per cent in September from a year earlier but would slow until the year-end, it said. Output of plastic pellets dropped 12 per cent from a year before but demand was likely to pick up after the flooding. The flooding has affected electronics and auto sectors in particular. Thailand is a regional hub for the world's top car producers, and even if most of the big assembly plants are in the east, away from the floods, car part firms have been hit. Firms such as Toyota Motor Corp and Honda Motor Co have scaled back production at plants as far away as North America. Honda, whose assembly plant has been flooded, said this week it did not know when car production would resume in Thailand. Factory output tracks export performance as industrial goods account for about 65 per cent of shipments. The commerce ministry expects exports to fall 13 per cent in the fourth quarter from a year earlier. Last week the central bank slashed its 2011 economic growth forecast to 2.6 per cent from 4.1 per cent and it expects export growth of only 7.9 per cent next year. The central bank has said it could call a special policy meeting before the next scheduled review on November 30. Economists generally expect interest rates will be left unchanged until next year but some say the chances of a cut have risen.