Thailand cement market – growth and sustainability: Nithi Patarachoke, Vice President: SCG Cement – Building Materials (Thailand)

Filmed at Cemtech Asia 2015, 21-24 June, Grand Hyatt, Bangkok, Thailand

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Ladies and gentlemen, good morning. I am very honored to be here with you today. Today I'm going to talk about three topics. First is Thailand demand and supply situation. Second, are in construction sector and driving fast, and the third one, growth and sustain-abilities Thai cement market. I will also use SCG as an example in the third topic.

Now I would like to start the first learn, this is the situation for demand supply. Now there are eight manufacturers in Thailand, total capacity about it 56 million tonnes per year. By the end of this year TPI Polene plans to commercialize about 4 million tonnes per year capacity. This is the supply capacity between, this is the first four largest manufacturer; SCG, Siam City Cement, TPI Polene, and Asia cement, and Jalaprathan cement, the same owner, and this second half we would have another four million tonnes.

Actually, the demand and supply situation since 1997, the crisis here, Tom Yum Goong crisis here in Thailand. Kaisi Men Market has been pressure by over supply situation until now. We still have this over supply situation but it's getting a little better. This is the driving force for the cement industry in Thailand.

We have three sectors; residential, infrastructure and commercial. Lastly, last year for a residential is 53% of the total cement consumption, infrastructure about 30% and commercial is about 17%. Bu this year, this is our forecast. This year the growth will be only a few percentage to 4% for this year, and residential will be only 50%, infrastructure 34% and commercial 16%. In Thailand, the demand new be mainly in metro area, East and North East. This accounts for about 60% of the total Thailand market. As you know, the first half of this year, Thailand economy declined from household income, lower household income, lower investments and demand.

So, only the good growth sector is only infrastructure from the government project. This is for the residential household income, the red letters are a minus factor. The green letters are plus factor. For the residential household income drop, but we have him at, decline in plan. Some already under construction urbanization.

For the private and non-residential, we have slowed down new projects. Now the private sector, they don't have much the new projects. Decline on exports, but they have confidence from the infrastructure projects. Further infrastructure in short term, now we have low cost infrastructure projects like small roads in the up-countries, and in the long term. In the next seven to eight years we will have makeup projects, which already start and will start.

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