Tata Steel (Thailand) Plc, a unit of India's largest steelmaker, has teamed up with steel manufacturers to jointly find ways to cope with the dumping of cheap Chinese steel products in the Thai market.
The dumping combined with decreasing domestic steel consumption is pushing local steel companies into fierce competition amid a sluggish market.
Tata Steel is in talks with the Federation of Thai Industries' Steel Industry Club and 10 other steel associations to address the influx of Chinese steel.
"We are discussing new measures to solve the problem and plan to ask for support from the government," said Tarun Kuma Daga, president and chief executive of Tata Steel Thailand.
Weaker local steel manufacturing is a serious concern for the government as capacity utilisation has decreased to less than 30%, following a slowdown in the industry and local steelmakers' inability to compete with low-cost imports from China.
Last year, China increased its steel exports by 22.7% year-on-year to 111 million tonnes, up from 90.3 million tonnes in 2023.
The higher steel exports in 2024 came after Beijing relaxed its steel output reduction policy, which was launched to reduce oversupply and pollution caused by the steelmaking process, the Steel Industry Club said earlier.
The club is optimistic about easing competition in the Thai market this year, believing China plans to export less steel as steel demand in China is expected to grow as the economy recovers.
According to the State Council of China, GDP reached US$18.8 trillion, posting growth of 5% last year.
The Joint Standing Committee on Commerce, Industry and Banking has called for the government to enforce the 1999 Anti-Dumping Act and the 2007 Safeguard Measures on Increased Imports to better protect the Thai market against the import of Chinese low-cost products in many industries.
According to Mr Daga, steel consumption in Thailand decreased by 1.2% year-on-year between January and November last year, continuing a decline. In 2023, domestic steel consumption dived by 12%.
"Over the 11-month period last year, steel consumption was 14.9 million tonnes, meaning the tally for the full year should be less than 16 million tonnes," he said.
Tata Steel expects steel consumption to increase in 2025, driven by the government's megaprojects worth 150 billion baht. These projects, which started last year, will require 300,000 tonnes of steel for a period of three years.
From October to December last year, the company reported total sales, which are currently under review, of 277,000 tonnes, down from 280,000 tonnes in the preceding quarter, attributed to lower domestic sales though its exports increased.
