Thailand's exports in the second quarter are likely to contract at a slower pace before picking up in the second half of the year thanks to China's recovery and improved demand from key markets, the Thai shippers' council said on Tuesday.

Exports, a key driver of growth, are expected to show zero to 1% growth this year, Chaichan Chareonsuk, chairman of the Thai National Shippers' Council, told a news conference.

"We are confident that (exports) should not be negative as several products such as food, agriculture and vehicles should continue to do well," he said.

Shipments in January-March came in better than expected, meaning exports have bottomed out and should continue to improve, Chaichan said.

In the first quarter of 2023, exports declined 4.5% from a year earlier, compared with the group's forecast for a 10% drop.

Second quarter exports are expected to fall 2.7% on an annual basis, the group said, versus a previous forecast drop of 4.7%.

The group is predicting exports will rise 0.6% in the third quarter from a year earlier before jumping 12% in the fourth quarter of the year.

The baht has been favourable and stable, which should continue to support exports, Chaichan said.

A baht exchange rate of 34-35 per dollar is not stronger or weaker compared with the currencies of trading partners and competitors, he added.

The baht was trading at 34.18 per dollar at 0543 GMT.

The group, however, said global uncertainty, high stockpiles and rising production costs remained negative factors for trade.

The central bank predicted exports would decline 0.7% for the whole of 2023. (Reporting by Orathai Sriring and Satawasin Staporncharnchai; Editing by Martin Petty, Kanupriya Kapoor)