Thailand considers revising domestic CR sheet ceiling prices

Thailand considers revising domestic CR sheet ceiling prices

The ceiling price system, brought into application by the Thai Government in order to protect the domestic steel industry from low priced imports and to enable the domestic producers to compete with the imports, is considered to be revised in Thailand, as a consequence of the rising price levels of cold rolled sheets in the international markets. With the effect of increasing international cold rolled sheet prices since the fourth quarter in the international markets that has now started to soften towards the end of the first quarter, necessity of an upward revision of the ceiling price of this material has arised. Consequently, Thai Government is now considering increasing the ceiling price of its domestic cold rolled sheets. Currently the set ceiling price for this material is at $420/mt level. Similarly, hot rolled coil transaction prices are subject to the government's price guidelines as well, and the set ceiling price for HRC is currently at $320/mt. Cold rolled steel manufacturers such as Siam United and Thai Cold Rolled Steel Sheet PCL had to face difficulties due to these ceiling prices in the domestic market. Apparently, these rolling mills import their hot rolled coil used for rolling into cold rolled sheet, basically from Japan, and they inevitably need to increase the price of their CR sheet output in order to meet the rising costs of HRC. For that reason, market players are of the opinion that the domestic price ceilings need to be revised upwards by at least $50/mt for cold rolled sheets to meet the prices of CR sheet imports going into Thailand.