Thai to Approve Foreign Major Steels’ Integrated Steel Project

Thai Abhisit administration will approve integrated steel project by foreign steel company at cabinet meeting in early February, according to officials of Thai ministry of industry. After the approval, the government launches project team for the project to select the site and make incentive package for foreign steel maker. The prime minister visits Japan, which is the largest investor country for Thailand, on February 5 and is expected to solicit investment by Japanese steel maker for the project. The government tries to develop the industry through the project.

The project team will pick up 3-4 sites in southern part of the country for the integrated steel plant. After the selection, the government starts the explanation of the project for local residents.

The government decided to launch the integrated steel project in November 2007 to meet growing domestic steel demand in Thailand. The government sounded Nippon Steel and JFE Steel. Arcelor Mittal and Baosteel Group showed the interest in the project. The four major steel makers are the potential investor for the project.

The government selects 4 sites and the 4 major makers could build integrated steel plants each while they could launch joint venture each other. The major makers can quit from the project.

Thai steel demand is annual 12 million tonnes and is expected to reach 30 million tonnes in future by expanding demand in automobile and construction, according to ministry of industry. The government expects the first project with 5 million tonnes of annual output capacity is followed by a couple of similar plants. The government expects the plants could meet 30 million tonnes of domestic demand along with the expansion for each plant.

Thai government approves the project before the prime mister visits Japan sending message for Japanese steel makers. With the message, Japanese steel makers should prepare the answer.