Thailand Steel Industry 2017

and Outlook 2018

Iron and Steel Institute of Thailand

June 2018
2018 SEAISI Conference and Exhibition
Content

Macro economics situation

Steel industry in 2017 and outlook 2018

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 Thai Economic Performance in 2017 and Q1/2018
GDP Growth
2016 2017 2018
(%YoY)
Year Year Q3 Q4 Q1
GDP (CVM) 3.3 3.9 4.3 4.0 4.8
2017 Q1/2018
Total Investment 2.8 0.9 1.2 0.3 3.4 = 3.9 % =4.8%
Private 0.5 1.7 2.5 2.4 3.1
Public 9.5 -1.2 -1.6 -6.0 4.0
The GDP expanded by 4.8%,
Private Consumption 3.0 3.2 3.4 3.5 3.6
Government
accelerating from 4.0% growth in
2.2 0.5 1.8 0.2 1.9 Q4/2017.
Consumption
Export of Goods 0.1 9.7 12.5 11.6 9.9
Volume 0.5 5.9 8.7 7.0 5.0 Private consumption and total
Import of Goods -5.1 14.4 13.0 14.6 16.3 investment will grow by 3.6 and 3.4
Volume -2.5 8.4 8.8 8.3 9.2 percent respectively. Export value of
Current Account to goods grew by 9.9%.
11.7 10.6 12.1 9.3 13.3
GDP (%)
Inflation 0.2 0.7 0.4 0.9 0.3 Meanwhile, the inflation rate was 0.3
percent and the current account
registered a surplus of 13.3 percent to
GDP.
Source: Iron and Steel Institute of Thailand

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 Q1/2018, Overall expenditure side improved, both
private and Government consumption expenditure.

Private consumption
expenditure

expenditure continually grew by

3.6 percent, slightly picked up
from 3.4 percent in the previous
quarter.

Government consumption
expenditure

rose by 1.9 percent

2016 2017 2018
Growth (YoY%) accelerating from 0.2 percent
Year Year Q3 Q4 Q1 expansion in previous quarter.
Private consumption 3.0 3.2 3.4 3.5 3.6 .

Government consumption 2.2 0.5 1.8 0.2 1.9

Source: Iron and Steel Institute of Thailand

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 Q1/2018, Total investment grew by 4.7%

Private investment
expanded by 3.1 percent
improved from the 2.4 percent
expansion in the previous
quarter

Public investment
grow by 8.6 percent,
recovering from a contraction
of 1.2 percent in 2017.

2016 2017 2018

Growth (YoY%)
Year Year Q3 Q4 Q1
Total Investment 2.8 0.9 1.2 0.3 4.7
Private 0.5 1.7 2.5 2.4 3.9
Public 9.5 -1.2 -1.6 -6.0 8.6

Source: Iron and Steel Institute of Thailand

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 Q1/2018 Construction sector increased by 1.2%

Public Construction
slightly decreased by 0.1%, but
improved from a 7.1% decline in
the previous quarter

Private sector Construction

increased by 3.4 %, significantly
improved from a 2.3 % decline in
the previous
quarter

2016 2017 2018

Growth (YoY%)
Year Year Q3 Q4 Q1
Construction Sector 8.3 -2.3 -1.6 -5.3 1.2
Private Construction 1.1 -1.0 -1.0 -2.3 3.4
Public Construction -3.0 -12.1 -1.8 -7.1 0.1

Source: Iron and Steel Institute of Thailand

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 is expected to expand in the range of 4.2 – 4.7 percent
2016 2017 2018
(%YoY)
Year Year Q3 Q4 Q1 Year(f)
Key Components of
GDP (CVM) 3.3 3.9 4.3 4.0 4.8 4.2-4.7 Economic Projection for 2018
Total Investment 2.8 0.9 1.2 0.3 3.4 4.7
Private 0.5 1.7 2.5 2.4 3.1 3.9 Expansion of goods and services
Public 9.5 -1.2 -1.6 -6.0 4.0 8.6
Private Consumption 3.0 3.2 3.4 3.5 3.6 3.7
exports, private consumption
Government expenditure, as well as the
2.2 0.5 1.8 0.2 1.9 3.0
Consumption stronger-than-expect growth of
Export of Goods 0.1 9.7 12.5 11.6 9.9 8.9
agricultural and manufacturing
Volume 0.5 5.9 8.7 7.0 5.0 4.9
Import of Goods -5.1 14.4 13.0 14.6 16.3 12.7 sectors.
Volume -2.5 8.4 8.8 8.3 9.2 6.7
Current Account to
11.7 10.6 12.1 9.3 13.3 8.4
GDP (%)
Inflation 0.2 0.7 0.4 0.9 0.3 0.7-1.7

Source: Iron and Steel Institute of Thailand

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Content

Macro economics situation

Steel industry in 2017 and outlook 2018

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 In 2017, apparent steel demand decreased to 16.65 MT,
by -13.6% from 2016.

Source: Iron and Steel Institute of Thailand

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 In 2017, production, import and apparent consumption
decreased from 2016 except export.

Consumption = 11.33 MT, -13.6%

Production = 6.87 MT, -13.6%

Import = 11.33 MT, -10.2%

Export = 1.55 MT, +20.0%

Source: Iron and Steel Institute of Thailand

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In 2017, ratio long product demand : flat product demand
= 34 : 66
Long product Flat product
Cons = 5.65 mt, Cons = 11.00 mt,
-25.6% -5.9%

Prod = 3.95 mt, Prod = 2.93 mt,

-25.2% +9.3%

Im = 2.61 mt, Im = 8.71 mt,

-16.4% -8.2%

Ex = 0.92 mt, Ex = 0.64 mt,

+12.4% +33.1%

Source: Iron and Steel Institute of Thailand

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Consumption by product in 2017
Bar & Section ('000 tonnes) 2016 2017 % Change '17/'16
Production 4,753 3,201 -32.7%
Import 916 712 -22.2%
Export 554 547 -1.2%
Apparent Consumption 5,115 3,367 -34.2%

Wire rod ('000 tonnes) 2016 2017 % Change '17/'16

Production 528 750 42.0%
Import 1,691 1,300 -23.2%
Export 5 15 202.4%
Apparent Consumption 2,214 2,034 -8.1%

HR Flat Product ('000 tonnes) 2016 2017 % Change '17/'16

Production 2,676 2,925 9.3%
Import 4,982 4,164 -16.4%
Export 19 13 -32.5%
Apparent Consumption 7,640 7,076 -7.4%

CR Flat Product ('000 tonnes) 2016 2017 % Change '17/'16

Production 1,842 1,956 6.2%
Import 1,266 1,574 24.3%
Export 156 196 25.9%
Apparent Consumption 2,952 3,334 12.9%

Coated Flat Product ('000 tonnes) 2016 2017 % Change '17/'16

Production 1,427 1,501 5.2%
Import 2,722 2,556 -6.1%
Export 125 220 76.2%
Apparent Consumption 4,024 3,838 -4.6%
Source: Iron and Steel Institute of Thailand

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In 2017, Thailand steel industry currently low capacity
utilization

Source: Iron and Steel Institute of Thailand

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Thailand rely on finished steel import around 11.33 MT in 2017
(by product)

No Product Group Quantity (Ton) Percentage

1 HR Coils/Sheets 3,718,039 33%
2 Coated Steel 2,556,427 23%
3 CR Coils/Sheets 1,574,661 14%
4 Wire rod 1,299,521 11%
5 Pipes & Tubes 633,876 6%
6 Bar 633,866 6%
7 Cold-finished & formed 385,299 3%
8 HR Plate 446,009 4%
9 HR Section 78,436 1%
Total 11,326,134 100%

Source: Iron and Steel Institute of Thailand

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Thailand rely on finished steel import around 11.33 MT in 2017
(by country)

No Country Quantity (Ton) Percentage

1 Japan 4,872,245 43.02%
2 China 2,940,480 25.96%
3 South Korea 1,683,401 14.86%
4 Taiwan 579,055 5.11%
5 Vietnam 388,721 3.43%
6 India 157,475 1.39%
7 Malaysia 119,556 1.06%
8 Australia 118,554 1.05%
9 Egypt 111,565 0.99%
Other 355,083.13 3.14%
World 11,326,134 100.00%
Source: Iron and Steel Institute of Thailand

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2017 Thailand steel demand breakdown.

 Demand per capita is 251 Kg.

 Ratio Long product : Flat product = 34 : 66

Packaging ,
3.90%
Appliance ,
 Demand breakdown 9.30%

- Construction 57.6%
Machinery &
- Automotive 18.1% Industrial,
11.10%
- Machinery & Industrial 11.1% Demand
- Appliance 9.3%
breakdown
Construction ,
57.60%
- Packaging 3.9% Automotive,
18.10%

Source: Iron and Steel Institute of Thailand

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Apparent steel demand in first quarter 2018 Increased
significantly compare with last year

Thailand steel demand during Jan - Mar 2018

Total ('000 Tonnes) Jan-Mar 2017 Jan-Mar 2018 % Change
Production 1,802 1,970 9.3%
Import 2,813 2,838 0.9%
Export 404 433 7.3%
Apparent Consumption 4,211 4,375 3.9%

Long ('000 Tonnes) Jan-Mar 2017 Jan-Mar 2018 % Change

Production 1,080 1,155 6.9%
Import 582 633 8.8%
Export 243 254 4.6%
Apparent Consumption 1,419 1,534 8.1%

Flat ('000 Tonnes) Jan-Mar 2017 Jan-Mar 2018 % Change

Production 722 815 13.0%
Import 2,231 2,205 -1.2%
Export 161 179 11.3%
Apparent Consumption 2,792 2,841 1.8%

Source: Iron and Steel Institute of Thailand

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 Thailand steel demand forecast 2018

Apparent consumption +13.2% in 2018 at 18.84 MT.

11.7-14.7%

Source: Iron and Steel Institute of Thailand

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 Thank you

Disclaimer
The information in the above report, publication and website has been obtained from sources believed to be
reliable. However, Iron & Steel Institute of Thailand does not guarantee the accuracy, adequacy or completeness of
the information. Any opinions or forecasts regarding future events may differ from actual events or results. In
addition, Iron & Steel Institute of Thailand reserves the right to make changes and corrections to the information,
including any opinions or forecasts, at any time without notice.

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