What To Know
- The Thai steel industry is bracing for new challenges after the United States moved to impose a massive 50% import tariff on steel under Trump’s renewed economic protectionist push.
- Thailand’s challenge now is to pivot quickly—modernize its steel base, protect its industries, and adapt to a new era of volatile global trade.
Bangkok Business News: A Heavy Blow to the Global Steel Chain
The Thai steel industry is bracing for new challenges after the United States moved to impose a massive 50% import tariff on steel under Trump’s renewed economic protectionist push. This bold move, designed to protect American producers, could worsen Thailand’s already fragile steel sector by amplifying the flood of cheaper foreign imports and further eroding domestic competitiveness. Midway through the supply chain, local manufacturers fear mounting price pressure and a squeeze on margins that could reshape Thailand’s industrial landscape. This Bangkok Business News report finds that the reverberations of Washington’s trade wall will likely hit Southeast Asia’s emerging economies hardest, particularly Thailand, where steelmakers are already struggling with high production costs and declining utilization rates.
Thailand’s steel industry braces for a major blow as US tariffs disrupt global markets and intensify regional import pressures.
Image Credit: AI-Generated
Thailand’s Production Plunge and Growing Imports
From 2019 to 2025, Thailand’s steel output is projected to shrink by around 2.5% annually, driving down capacity utilization from nearly 57% in 2016 to just 40% by 2025. As domestic producers lose ground, the country risks being flooded with both premium steel from Japan and South Korea and low-cost imports from China, which retain a strong pricing advantage. With imports rising and domestic competitiveness eroding, local mills are being forced to either modernize or shut down. Analysts warn that if these trends persist, the Thai steel industry could face a systemic crisis that undermines its role in national infrastructure and manufacturing.
Tariff Expansion Pressures and Downstream Impacts
The US decision under Section 232 now covers more than 400 steel-related products, intensifying global competition. Thai exporters to the US face heavier costs, while local manufacturers may struggle to source affordable materials. Compounding matters, Thai steel parts—often with low local content—risk being flagged as transshipment goods and subjected to even higher penalties. This scenario could weaken Thailand’s position in major global supply chains and create ripple effects across automotive, construction, and electronics industries.
Strategies for Survival and Adaptation
Experts urge Thai producers to accelerate efficiency improvements, diversify raw material sourcing, and upgrade to value-added products. The future lies in specialized steel for high-tech sectors such as aerospace, defense, and green manufacturing. The push toward “green steel,” compliant with global carbon reduction standards, is seen as both a survival strategy and an opportunity to capture premium markets amid tightening environmental regulations worldwide.
The Crucial Role of Government Support
The government’s intervention is now more critical than ever. Reducing electricity tariffs, offering tax incentives, and funding innovation in advanced steel technologies could help sustain competitiveness. Authorities must also enforce anti-dumping measures, regulate new foreign steel investments, and stimulate domestic demand through infrastructure projects. Without these structural reforms and safeguards, the nation’s steel backbone could face a prolonged contraction with far-reaching industrial consequences.
The escalating global steel war underscores how geopolitical trade maneuvers can reshape entire economies, leaving smaller nations vulnerable to the fallout of protectionist agendas. Thailand’s challenge now is to pivot quickly—modernize its steel base, protect its industries, and adapt to a new era of volatile global trade.
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