According to Bangkok-based trade sources, delays in construction projects in Thailand and increased steel supply have led to lower demand.
Domestic steel prices have been declining, with rebar prices dropping by over THB 1,000 per ton (approximately USD 28) this month. Billet and scrap prices have also seen reductions. A trader in Bangkok pointed out that users and stockists currently hold 2-3 months' worth of inventory, compared to the usual 1.5-2 months. "They are unable to make further purchases," the trader commented. As of last Friday, local rebar prices were around THB 18,400 per ton (USD 511) delivered to stockists and end-users.
The first five months of the year saw sluggish Thai steel sales, attributed to reduced spending on construction projects and competitive pricing pressures from low-cost Chinese steel imports, stated Tarun Kuma Daga, president and CEO of Tata Steel (Thailand), in an interview with the Bangkok Post. Finished steel product consumption decreased by 8.7% year-on-year to 2.47 million tons, while overall steel consumption fell by 6.9% from January to May.
In May, Thailand's steel production showed signs of recovery, while steel consumption saw a slight increase. Both steel imports and exports have been trending downwards during this period.
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