According to the Iron and Steel Institute of Thailand, in first half of 2019 steel production in Thailand was at 3.93 million mt, down by 13.3 percent compared to the same period of 2018. Meanwhile, finished steel consumption in the given period decreased by 2.7 percent year on year to 9.39 million mt, despite expectations of a better consumption figure because of the one percent growth in 2018. In the given period, the country’s consumption of long steel fell by 5.4 percent and flat steel consumption was down by 1.1 percent, both year on year.
The fact that the decrease rate in production was higher than the decrease in consumption indicates that import flow posed a problem for local steel producers. The fall in consumption is considered to be due to Thailand’s overall economic slowdown, as well as lower demand in both domestic and foreign markets amid trade conflicts.
Meanwhile, one of the major long steel producers in Thailand, Millcon Steel Public Company Limited, registered a net loss of THB 121.2 million ($3.92 million) in the first half this year, compared to net profit of THB 106.5 million in the same period of the previous year. The company had a better second quarter, compared to the first quarter, posting a net profit of THB 68 million ($2.2 million), up 67 percent year on year, on the back of the reduced cost of raw material and sales. In the first quarter of the current year, the company saw a net loss of THB 186.9 million.
The company’s sales revenues in the second quarter decreased by 13 percent year on year to THB 4.52 billion ($146.3 million), due to lower billet sales as the company used billets for its own steel bar production. During the second quarter, the sales volume of steel bars increased by 19 percent compared with the same period of the previous year.