Trade group bullish on Thai steel demand

0

A worker handles a steel bar at the Millcon Steel factory in Rayong which produces steel bars, wire rod and structural steel. The company’s steel production is used in construction and other industries, including automotive manufacturing.

Thailand’s Iron and Steel Institute expects the country’s steel market to grow by at least 5% in 2022 and called for greater government collaboration.

Nava Chantanasurakon, chairman of the institute, predicted Thai steel demand would grow by at least 5% year-on-year in 2022, citing a rebound in exports and services.

He said steel serves as the backbone of the manufacturing sector and is part of the government’s plan for a circular economy.

The pandemic has caused problems for Thailand’s manufacturing sector, including a labor shortage, new social distancing measures for construction projects as well as longer construction periods, Nava said.

Wirote Rotewatanacha, chairman of the institute, reported a 15% year-on-year increase in steel consumption to 17.3 million tonnes in the first 11 months of 2021.

The organization cited a 22% increase in flat steel consumption and a 4% rise in long steel.

However, in terms of expansion, the steel import rate of 20.9% is higher than the country’s manufacturing rate of 8.3%.

To remedy this, the institute is working on a Steel 4.0 development plan with the National Innovation Agency and other associations.

This plan aims to provide government assistance to domestic steel producers, with a strong emphasis on public-private partnerships, government steel purchase contracts, public assistance programs and measures to to avoid a glut of steel.

Steel prices have fallen because producers around the world have returned to near-normal manufacturing capacity, Nava said.

The latest figures in early January for flat steel and long steel in China were $756-762 a ton, down 18-24% from their record high in mid-2021, Ms. Nava.

Mr Nava said steel prices were unlikely to fall as low as in 2020 as prices in China and Asia have stabilised.

Two factors that could drive the price of steel higher in the first quarter of 2022 are China’s removal of an export value-added tax refund on steel products and tighter regulations and oversight. environmental issues in the country, he said.

Nava said he was monitoring the effects of the Regional Comprehensive Economic Partnership free trade agreement, which came into effect earlier this year, on Thailand’s steel import rate.

Share.

About Author

Comments are closed.