Asian Metal: Hello, Mr. Huang. Thanks for joining the interview. Please briefly introduce your businessscale and main products.

Mr. Huang: My pleasure. Founded in 1984, Chonburi Thaisawasdi Co. acts as the medium-sized uncoiling factory and steel distributor in Chonburi, Eastern of Thailand. Chonburi Thaisawasdi Co. majors in dealing with hot rolled coil, steel plate, steel pipe, angle steel, channel steel and steel round bar, with the monthly trading volume of 2,500-3,000t. Besides steel trading, the company also involves in uncoiling, shearing, bending by press break machine, milling and laser cutting and owns 2 flattening, 18 cutting and bending machines.

AsianMetal: Which domestic steel mills do you cooperate with? Where are materials sold? How about customers?

Mr. Huang: Chonburi Thaisawasdi Co. mainly cooperates with steel mills in Rayong, Thailand. The company sells materials to traders and manufactures of home-appliance, auto-parts and steel structural in Bangkok and metropolitan areas.

AsianMetal: Does Thai HRC market rely on import materials? How about the proportion of domestic resources and imported HRC?

Mr. Huang: Local government carried out several import restrictions to protect domestic steel mills. The imported HRC accounts for around 50% now, with the rest 50% produced by domestic steel mills, while the import materials stayed at around 80% before 2017. Most imported materials come from Japan, Vietnam and South Korea.

AsianMetal: HRC export prices in China witnessed increase of approximately 33% since early this year. How about the HRC market in Thailand?

Mr. Huang: Prices of HRC in Thailand also rose by about THB9,500/t (USD284/t) or 43% since January stimulated by the significant price increase in China. Actually, the downstream demand remains relatively steady since early of the year, but the supply fluctuates as traders prefer to hold back from selling when prices in China and other countries show an upward trend. When they turn to active in selling, the demand failed to improve, leading to a slow market. Besides, seeing the serious pandemic, endusers purchase strictly according to orders for final products and hesitate in purchasing in large quantities. Nowadays, prices tend to stabilize and the purchasing activities from end users improve gradually.

AsianMetal: Please further introduce the HRC market in Thailand detailedly.

Mr. Huang Huang: Prices of HRC kept rising in the first half of the year boosted by the upward price trend in China, with the markup of around THB10,500/t (USD315/t). Dragged by the new wave of COVID-19, local government required construction projects to halt production at the end of June. Though it lifted the lockdown gradually from September 1, the sharp increase in cases, 20,000 a day, made the market dim. Nowadays, end users tend to purchase in small quantities to avoid potential risks and refuse to build stocks. However, most traders foresee higher prices. It is well known that steel mills in Thailand rely on steel scrap import, and the depreciation of Thai baht against U.S. dollars made the production costs increase, which stimulates steel mills to raise prices. Prices of steel scrap stand at around THB18,000/t (USD545/t) for the moment, while they remained at around THB14,200/t (USD427/t) in early August. After raising HRC EXW prices to THB3,200/t (USD961/t) for September production from THB31,000/t (USD931/t) for August production, local steel mills lifted HRC EXW prices to THB32,300/t(USD970/t) for November production in the middle of October.

AsianMetal: Does the market witness the improvement following the government liftingthe lockdown from early September?

Mr. Huang: After blockade in September, the performance of hot rolled coil market failed to recover obviously. On the one hand, the demand from downstream industries remains sluggish under the serious COVID-19 pandemic, while on the other hand, the frequent price change in the global market heightens the wait-and-see attitudes of downstream customers. They purchase strictly according to orders for final products and refuse to build stocks. Our sales volume reached around 14,700t in the first three quarters of this year, while we sold approximately 21,200t in the corresponding period in 2020. We show confidence in Q4 and believe the sales volume would witness the increase of about 10% on the basis of Q3.

AsianMetal: How do you think the market prospect in the last month of 2021?

Mr. Huang: We foresee higher prices of HRC in the remainder of the year. They might hike to THB34,000/t (USD1,021/t) by the end of the year from the current THB32,000/t (USD961/t). Firstly, the price increase of raw materials would stimulate steel mills to lift HRC prices. Secondly, the demand from downstream industries would improve gradually with the positive control of the pandemic. Thirdly, the price increase from other countries stimulated by the reduced supply in China would strengthen the confidence of market participants and impose positive effect on the market.

Asian Metal: Thank you for your sharing.

Mr. Huang: Thank you.