The construction and automotive sectors were adversely impacted in Thailand this year, due to industry shutdowns brought on by the COVID-19 pandemic. Steelmakers expect recovery through help from the government, to offer greater protection for local mills and to proceed with large-scale investment projects.
Thai steel and iron output fell by 12.9pc annually from 4.7mn mt to 4mn mt in the Jan-July period of this year, according to media reports. Steel consumption in the same period fell by 13.3pc year-on-year from 11mn mt to 9.6mn mt. About 60pc of steel produced is used in the construction, with about 40pc going towards car and appliance manufacturing in the country. In July, the automotive sector endured a decline in production, utilizing about 47pc of capacity.
Thailand’s domestic steel consumption for the remainder of the year is projected to drop to 16.7mn mt compared to 18.6mn mt in 2019. Government officials are developing wide-ranging infrastructure projects in an effort to increase steel capacity utilization, that currently stands at about 30pc.
While steel consumption is projected to increase in Vietnam due to governmental infrastructure projects, Thailand is projecting much consumption for 2020. Steel usage is projected to drop by 6.9pc in 2020 to 17.8mn mt compared to 18.5mn mt in 2019, due to weak markets, competition and cheap imports from nearby Asian countries.