[SMM Hot Topic] Analysis of the Current State of the Steel Industry in Southeast Asia — Thailand (Part 1)

• Thailand Market Overview

Thailand, located at the center of ASEAN, has a significant geographical advantage, with a relatively stable society, high policy transparency, and a high degree of trade liberalization. The business environment is open and inclusive, making it the second-largest economy in ASEAN. In 2023, the world's GDP was $10,543,504.4 billion, up 2.72% YoY; Thailand's GDP was $514.945 billion, an increase of $19.3 billion from the previous year. The world's per capita GDP in 2023 was $13,138.3, while Thailand's per capita GDP was $7,171.81, an increase of $258.76 from the previous year. In 2024, Thailand's GDP growth rate is 2.5%, which is lower than the median estimate of 2.7% but higher than the revised 2023 economic growth rate of 2%.

Figure 1 - Thailand and Global GDP Situation

Data Source: World Bank, SMM

• Steel Supply in Thailand

According to statistics published by the World Steel Association, Thailand's crude steel production in 2024 is 4.918 million mt, down 1.17% YoY, ranking 27th globally and fourth among ASEAN countries, after Vietnam, Indonesia, and Malaysia.

Figure 2 - Thailand Crude Steel Production and YoY Growth 2020-2024

Data Source: WSA, SMM

The Thai steel industry consists of midstream and downstream enterprises. Midstream enterprises produce and process intermediate steel raw materials, including flat steel bars (slabs) and long steel billets (blooms), most of which are imported from abroad. For downstream enterprises, they process these semi-finished products into various shapes through hot rolling, cold rolling, coating, or forming (such as hot/cold rolled steel, coated/electroplated steel, rebar, and various structural steels), becoming producers of downstream products.

Thailand's steel capacity is approximately 17 million mt, with over 90% using electric arc furnace (EAF) technology, except for Tata Steel. Major steel companies in Thailand include GSteel (1.6 million mt), GJSteel (1.5 million mt), and Tata Steel (Thailand) (1.4 million mt). In December 2021, Nippon Steel announced a $419 million investment to acquire 49.99% of G Steel and 40.45% of GJ Steel. Singapore-based steel manufacturer Meranti plans to establish Southeast Asia's first green flat steel mill in Thailand, expected to be operational by 2027 with an annual capacity of 2 million mt, increasing total steel capacity.

Table 1 - Major Steel Producers in Thailand

In terms of finished product structure, in 2024, long steel production accounts for about 62% of total domestic steel production, flat steel for around 34%, and pipes and other products for about 4%.

Figure 3 - Finished Product Structure in Thailand

Data Source: ISIT, SMM

The Thai steel industry has been impacted by Chinese steel companies entering the ASEAN market for over a decade, leading to a continuous decline in local capacity. In 2024, Thailand's crude steel production is 4.918 million mt, with a crude steel capacity of approximately 17 million mt, resulting in a capacity utilization rate of only 29%, significantly lower than the 35-40% rate from 2016-2021. This extremely low capacity utilization means that local steel supply cannot meet domestic demand, leading to a high dependence on imports. In 2023, Thailand ranked as the 9th largest steel importer globally, with 13.7 million mt of imports; net imports reached 12 million mt, ranking fourth globally, behind the US, Egypt, and Mexico.

Figure 4 - Thailand Steel Imports and Global Net Import Rankings 2019-2023

Data Source: WSA, SMM

From 2019 to 2023, Thailand's domestic steel production was around 7.5 million mt annually, with 70% of long steel production used in construction and 30% of flat steel production used in construction, automotive manufacturing, and various components and appliances. Over the past five years, the average annual import of steel was 14.52 million mt, accounting for 63% of domestic steel supply. Due to cost structures and cheaper foreign steel prices, Thailand's steel imports have continued to increase.

By 2025, Thailand's domestic steel production is expected to reach around 5.8 million mt, mainly supported by increased long steel production (+0.8%) for domestic construction activities. Meanwhile, flat steel production still faces competition pressure from Chinese steel, with overall steel supply coming from both domestic production and imports.

Figure 5 - Thailand Steel Supply Over the Last 7 Years (million mt)

Data Source: ISIT, SMM

According to the Iron and Steel Institute of Thailand (ISIT), given the continuous increase in imports, Thai steel manufacturers reduced finished steel production in January, producing 563,564 mt, down 1.2% YoY, with long steel production at 372,304 mt and flat steel production at 191,260 mt.

Figure 6 - 2025 Thailand Long and Flat Steel Production (10,000 mt)

Data Source: ISIT, SMM

Due to space limitations, details on Thailand's steel demand and import-export situation will be covered in the next article.

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