0

Overview of Steel Industry in Thailand

Mr. Hin NavawongseIron and Steel Institute of Thailand

November 2006

1

Contents

Thailand steel situation

Specific Energy Consumption (SEC) in 1999 - 2004

2

Integrated steel production process

Iron ore + Cokeor

Iron ore + Natural gas

Ironmaking

Pig ironSponge iron

Steelmaking & casting

Steel forming

Scrap

Electric Arc FurnaceBasic oxygen Furnace

Hot metal

BilletBloom

Slab

Heavy Section

Round bar, Deformed bar

Wire rod

Light section

Hot rolled coil Hot rolled plate

Cold rolled coil

HDGEGTin plate, tin free

Pipe

Cold formed section

HDG Pipe

Downstream industry Construction Auto parts Appliance Furniture Packaging

3

Thailand Apparent Steel Consumption (million MT)

0

2

4

6

8

10

12

14

16

1997 1998 1999 2000 2001 2002 2003 2004 2005 2005Jan-Aug

2006Jan-Aug

Production Import Export Apparent Consumption

12.66, 16%

13.88, 9.6%

8.31, -15.7%

Source : ISIT

The decline since second half of 2005 was mainly derived from a slowdown in consumer expenditure and investment.

4

Thailand Long Product Apparent Consumption (million MT)

0

1

2

3

4

5

6

1997 1998 1999 2000 2001 2002 2003 2004 2005 2005Jan-Aug

2006Jan-Aug

Production Import Export Apparent Consumption

5.61, 1%5.56, 22%

3.50, -15.6%

Long Product 2005 Jan-Aug 2006 Jan-Aug %ChangeProduction 3,664 3,134 -14.5%Import 674 618 -8.4%Export 194 252 30.3%Apparent Consumption 4,145 3,500 -15.6%

Unit : 000 MT

Long Products Bar Consumption (000 MT)

050

100150200250300350400450

Jan

Feb

Mar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

2004 2005 2006

Production Import Export Consumption

Wire rod Consumption (000 MT)

020406080

100120140160180

Jan

Feb

Mar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

2004 2005 2006

Production Import Export Consumption

Bar Consumption (000 MT)

Wire rod Consumption (000 MT)

Source : ISIT

5

2,7003,293 3,235 2,712

2003 2004 2005 2006E

158 182230 232

45 3588

47

2003 2004 2005 2006E

Main destination (export)

- USA

- Cambodia

- Lao Republic

- Australia

Bar

Bar production

Bar import - export

Production

Major sources (import)

-S.Korea

- Taiwan

- Japan

- China

Producers

- Millineum Steel - Bangsaphan Bar mill

- Bangkok Steel Industry - Chonviriya Steel

- Burapa Steel Industries - Thai Steel Profile

- Other

Unit : 000 MT

Source : ISIT

ImportExport

6

8441,120 1,024 891

2003 2004 2005 2006E

365 358 407 398

6 7 74

2003 2004 2005 2006E

Wire rod

Unit : 000 MT

Wire rod supply

Wire rod import - export

Production

Major sources (import)

-China

- Taiwan

- Japan

- India

Producers

Main destination (export)

- Vietnam

- Cambodia

- Lao Republic

- India

- Siam Iron and Steel (2001)

- Bangkok Industrial Steel Work

- Tycoons Worldwide

- Thai Special Steel Industry

- Other

Source : ISIT

ImportExport

7

Coated consumption (000 MT)

0

50

100

150

200

250

Jan

Feb

Mar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

2004 2005 2006

Production Import Export Consumption

Flat Products

Flat Product 2005 Jan-Aug 2006 Jan-Aug %ChangeProduction 2,788 2,767 -0.7%Import 3,807 3,020 -20.7%Export 889 982 10.5%Apparent Consumption 5,706 4,805 -15.8%

Unit : 000 MT

Coated Consumption (000 MT)

HR Sheet consumption (000 MT)

0100200300400500600700

Jan

Feb

Mar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Ja

nFe

bM

ar Apr

May

Jun

Jul

Aug

2004 2005 2006

Production Import Export Consumption

HR Consumption (000 MT)

CR & CR stainless consumption (000 MT)

0

50

100

150

200

250

300

Jan

Feb

Mar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Jan

Feb

Mar Apr

May

Jun

Jul

Aug

Sep

Oct

Nov Dec Jan

Feb

Mar Apr

May

Jun

Jul

Aug

2004 2005 2006

Production Import Export Consumption

CR&CR Stainless Consumption (000 MT)

Thailand Flat Product Apparent Consumption (million MT)

0

1

2

3

4

5

6

7

8

9

1997 1998 1999 2000 2001 2002 2003 2004 2005 2005Jan-Aug

2006Jan-Aug

Production Import Export Apparent Consumption

7.1, 11%

8.27, 16.5%

4.81, -15.8%

Source : ISIT

8

3,3283,905

4,418 4,090

2003 2004 2005 2006E

2,348 2,354 2,6381,896

613 914 946275

2003 2004 2005 2006E

Hot Rolled Products

Main destination (export)- USA- Europe- Vietnam- Indonesia

Producers

Production

HR supply

HR Import - export

- Sahaviriya Steel Industry

- G Steel

- NSM

- Sahaviriya Plate Mill

- LPN

Major sources (import)

- Japan

- China

- S.Korea

- Taiwan

Unit : 000 MT

Source : ISIT

ImportExport

9

2,115 2,1201,595 1,407

2003 2004 2005 2006E

545622

714 655644

274375

517

2003 2004 2005 2006E

Main destination (export)

- Malaysia

- Vietnam

- China

- Hong Kong

Production

Cold Rolled Products

CR supply

CR Import - export

Producers

- TCRSS

- Siam United Steel

- Bluescope Steel (Thailand)

- Thainox Stainless

Major sources (import)

- Japan

- China

- S.Korea

- Taiwan

Unit : 000 MT

Source : ISIT

ImportExport

10

437 443333 310

2003 2004 2005 2006E

593 6871,018 941

87 38 6976

2003 2004 2005 2006E

Production

Main destination (export)

- Myanmar

- USA

- Malaysia

- Lao Republic

Coated Products - GI

GI supply

GI Import - export

Producers

- Bangkok Steel Industry

- Thai Coated Steel

- Sangasri Thai

- Thailand Iron Work

- Ratchasima Steel

Major sources (import)

-Japan

- China

- S.Korea

- Taiwan

Unit : 000 MT

Source : ISIT

ImportExport

11

407 466360 372

2003 2004 2005 2006E

120 138 112 135

7 6 85

2003 2004 2005 2006E

Main destination (export)

- Lao Republic

- Indonesia

- Cambodia

- Vietnam

Major sources (import)

- S.Korea

- Taiwan

- Japan

- China

Coated Products – TP&TF

TP&TF supply

TP&TF Import - export

Production

Producers

- Siam tinplate

- Thai tinplate

Unit : 000 MT

Source : ISIT

ImportExport

12

148 176 177233

2003 2004 2005 2006E

148

248 239289

42 61 9072

2003 2004 2005 2006E

Main destination (export)

- Lao Republic

- Indonesia

- Cambodia

- Vietnam

Coated Products – Other coated (Zn-Al, color, other metallic coated)

Other coated supply

Other coated import - export

Production

Major sources (import)

-Japan

- China

- S.Korea

- Taiwan

Producer

- Bluescope steel (Thailand)

Unit : 000 MT

Source : ISIT

ImportExport

13

Thailand steel Import – Export in 2005 (Unit : ‘000 tonnes)

-613

-115

-147

-17

-407

-230

-364

-1,368

-1,695

-3,476

-1,825

165

105

36

577

247

7

35

39

149

290

Billet

Wire rod

Section

HRC

HRP

CRC

Coated sheet

Slab

Bar

Seamless pipe

Welded pipe

Import Export

Thailand still relies on imports of both semi-finished and finished steel products, specially for flat steel product group.

Source : ISIT

14

Construction is a major consuming sector, most of its application requires commercial steel grade.

Total consumption in 2005 = 13.88 million tonnes

Consumption per capita in 2005 = 212 kg

Ratio of long : flat steel consumption = 40 : 60

Consumption by downstream sector

- Construction 60%

- Automotive 12%

- Industrial 11%

- Appliance 8%

- Packaging 5%

- Other 4%

Source : ISIT

Construction,60%

Automotive,12%

Industrial, 11%

Appliance, 8%

Packaging, 5%Other, 4%

15

Contents

Thailand steel situation

Specific Energy Consumption (SEC) in 1999 - 2004

16

Specific Energy Consumption for bar products

BAR with EAFRaw material : ScrapProduct : Round bar/deformed bar

Ratio (%)

Elec.51%

Fuel38%

oxygen10%

5,095

Average SEC

(MJ/ton)

BAR without EAFRaw material : BilletProduct : Round bar/deformed bar

Elec.19%

Fuel 81%

2,075

Source: team analysis

Average SEC

(MJ/ton)

Ratio (%)

17

Specific Energy Consumption for wire rod products

Wire rod with EAFRaw material : ScrapProduct : Wire rod

Wire rod without EAFRaw material : BilletProduct : Wire rod

Elec.46%

Fuel 36%

oxygen18%

6,442

3,212

Elec. 33%Fuel

67%

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

Average SEC

(MJ/ton)

Ratio (%)

18

Specific Energy Consumption for hot rolled section productsHot rolled section with EAFRaw material : ScrapProduct : Hot rolled section

Hot rolled section without EAFRaw material : BilletProduct : Hot rolled section

Elec. 40%

Fuel 47%

oxygen13%

6,051

2,886

Elec. 11%

Fuel 89%

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

Average SEC

(MJ/ton)

Ratio (%)

19

Specific Energy Consumption for hot rolled sheet productsHR with EAFRaw material : ScrapProduct : Hot rolled coil

HR without EAFRaw material : SlabProduct : Hot rolled coil / Hot rolled plate

Elec. 58%

Fuel 28%oxygen14%

4,710

Elec. 25%

Fuel75%

2,246

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

Average SEC

(MJ/ton)

Ratio (%)

20

Specific Energy Consumption for cold rolled sheet productsCRCRaw material : Hot rolled coilProduct : Cold rolled coil

HDGRaw material : Cold rolled coilProduct : Hot dip galvanized sheet

1,787 Elec.

42%

Fuel58%

Specific Energy Consumption for hot dip galvanized sheet products

1,439

Elec. 18%

Fuel 82%

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

Average SEC

(MJ/ton)

Ratio (%)

21

Specific Energy Consumption for electro-galvanized sheet productsEGRaw material : Cold rolled coilProduct : Electro-galvanized sheet

TP&TFRaw material : Cold rolled coil - TMBPProduct : Tin plate & tin free sheet

Specific Energy Consumption for tin-plate & tin-free sheet products

Elec.63%

Fuel37%

1,300

876 Elec.60%

Fuel40%

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

Average SEC

(MJ/ton)

Ratio (%)

22

Specific Energy Consumption for cold-formed section productsCold formed sectionRaw material : Hot rolled coilProduct : Cold-formed section

ERW pipeRaw material : HRC, CRCProduct : ERW pipe

Specific Energy Consumption for ERW pipe products

Elec.100%

21

235 Elec.100%

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

Average SEC

(MJ/ton)

Ratio (%)

23

Specific Energy Consumption for galvanized steel pipe productsHDG pipeRaw material : Hot rolled coilProduct : Hot dip galvanized steel pipe 1,67

0Elec. 28%

Fuel72%

Source: team analysis

Ratio (%)Average SEC

(MJ/ton)

24

2,512

2,869

2,553 2,487

2,9003,014

0

500

1,000

1,500

2,000

2,500

3,000

3,500

1999 2000 2001 2002 2004 2004

Thailand specific energy consumption in 1999 -2004

MJ/ton

Source: team analysis

25

Total energy equivalent demand for Thai steel industry is estimated 939 ktoe.Est. total

production in 2004 (‘000

tons)

SEC (MJ/ton) Energy consumption

(ktoe)

X =

Bar_EAF

WR_EAF

Section_EAF

HR_EAF

Bar_no EAF

WR_no EAF

Section_no EAF

HR_no EAF

CRC

HDG

EG

Tin plate

Cold-formed

ERW pipe

Gal. steel pipe

1,600

1,350

550

570

600

430

1,607

2,300

2,100

260

180

467

450

810

252

5,095

2,075

6,442

3,212

6,051

2,886

4,710

2,246

1,787

1439

1,300

876

21

235

1,670

195

67

85

44

87

30

181

123

90

9

6

10

0.22

5

10

EAF –Hot rolling mill

Hot rolling mill

Source: team analysis

26

Energy consumption for Thai steel industryEst. total

production in 2004 ('000

tons)

Energy consumption

(ktoe)

Production ratio (%)

Energy consumption

ratio (%)

1 Bar_EAF 1,600 195 12% 21%

2 Bar_no EAF 1,350 67 10% 7%

3 Wire rod_EAF 550 85 4% 9%

4 Wire rod_no EAF 570 44 4% 5%

5 Hot rolled section_EAF 600 87 4% 9%

6 Hot rolled section_no EAF 430 30 3% 3%

7 HR_EAF 1,607 181 12% 19%

8 HR_no EAF 2,300 123 17% 13%

9 Cold rolled steel sheet 2,100 90 16% 10%

10 Hot dip galvanized 260 9 2% 1%

11 Electro-galvanized 180 6 1% 1%

12 Tin plate & tin free steel 467 10 3% 1%

13 Cold formed section 450 0.22 3% 0.02%

14 ERW pipe 810 5 6% 0.48%

15 Hot dip galvanized steel pipe 252 10 2% 1%

13,526 939 100% 100%Total

Steel sectors

27

Conversion factor

Electricity kWh 3.6

Oxygen (EAF)* NM3 18.72 [ = 5.2 (kWh/NM3) x 3.6 (MJ/kWh)]

Natural gas MMBTU 1,055.87

LPG kg 50.23

Bunker oil litre 39.77

Diesel litre 36.42

Kerosene litre 34.53

Unit MJ

Remark: In steelmaking process, oxygen is one source of energy to melt steel scrap. Chemical reaction between oxygen and carbon evolves heat as exothermic reaction.