Thailand’s Country Report 2011 SEAISI Environmental and Safety Seminar November 2011 By Dr. Decha Pimpisut Director, Air Pollution Division Bureau of Industrial Water and Environmental Technology 1

Presentation Topics 1. Overview of Thailand’s Iron and Steel Industry 2. Factors that may impact on the industries on their environmental decision-making or performance 3. Special Topics 4. Conclusions 2

1. Overview of Thailand’s Iron and Steel Industry World steel demand is projected to be 1.4 billion tons in 2011, rise by 6% from 2010 Thailand steel demand is expected to go to 20.0 million tons in 2015, the highest rate among ASEAN countries of total 73 million tonnes in the same year 3

World steel output registered 1.4 billion tonnes in 2010 Source: World Steel Association North America South America Europe Asia CIS Ocenia Middle East World Crude steel production (Million tonnes) 4

ASEAN steel demand projection and growth rate (‘000 Tonnes) Thailand, Vietnam and Indonesia drive demand in region with more than 10% growth rate 5 Average demand growth rate during 2009 – 2015 (%) Steel demand in 2015 Source: ISIT analysis

6 Source: ISIT Analysis Steel demand (‘000 tonnes) Thailand steel market has been expanded at 7.6% on average a year

Steel consumption in 2011 is expected to slightly increase Source : ISIT analysis Thailand Steel Demand (‘000 Tonnes) 7

8 Construction is major steel consuming sector  Demand per capita = 204 Kg.  Ratio Long product : Flat product = 40 : 60  Demand breakdown - Construction 54% - Automotive16% - Machinery & Industrial13% - Appliance 12% - Packaging 5% Source: ISIT analysis

Steel and Iron Processes in Thailand 9

1. EAF using scrap as main raw materials to produce liquid steel. 2. Casting to produce Billet, Bloom and Thin Slab. 3. Downstream processes - Flat shape i.e. Hot Rolled Steel, Cold Rolled Steel & Coated Sheet etc. - Long shape i.e. Structural Steel, Bar, Wire Rod & wire etc. 4. One of Mini-blast furnace (without coke making) is reprocess and resubmitted EHIA to Office of Natural Resources and Environmental Policy and Planning (ONEP). Steel and Iron Processes in Thailand 10

Key Environmental Opportunities to Improve Industry’s Performance Managing and Minimize Waste Reducing Air Emission Increasing Energy Efficiency Promoting Environmental Management System (EMS) 11

2. Factors that may impact on the industries on their environmental decision- making or performance 2.1 External Influence 2.2 In the Steelworks 12

2.1 External Influence a. Regional (1) Influence of the Ratification of “Kyoto Protocol” Since the Kyoto protocol effective on 16 February CO 2 emitted from using of fuel is the key issue and the iron & steel plants are considered as an energy intensive sector. Manufacturer may face the pressure from public to use energy more efficient to reduce effect on climate change. But The period of Kyoto Protocol will be valid in 2012 that not clear how to do in this way. 13

2.1 External Influence (Cont.) (2) Free Trade Agreement (FTA) in Asia 7. There are several initiatives in Asia dealing with FTA. The FTA may effect the iron & steel industry in terms of lower cost of raw materials for importers but, on the other hand, manufacturers might have to improve their productivity and introduce new technology for cost effective in production processes to maintain their competitiveness. 14

2.1 External Influence (Cont.) (3) China’s Policy on exporting raw materials for steel making and intermediate steel products China has set policy on exporting raw materials for steel making and intermediate steel products, which affected on supply side of intermediate steel products. China also support high quality steel products and drive merging of existing factories in order to make more effective on steel producing. The policy also limit coal and water consumption not more than 0.73 ton and 8 ton per ton of product within 2010 and 0.7 ton and 6 ton per ton of product within 2020 respectively. 15

2.1 External Influence (Cont.) (4)Thailand Steelmaker take aim at China’s alloy steel exports The Thai Steel industry is being adversely affected by rising imports of alloy-added hot rolled steel products from China. These imports are unfair for the Thai steel mills because these alloy added products are being used in same applications are mild steel product with zero import-duty (normal 5% duty). Thailand Industrial Standards Substitution has been alerted to problem by conducting more inspection. 16

2.1 External Influence (Cont.) (5) ASEAN Economic community :AEC The ASEAN Economic Community (AEC) shall be the goal of regional economic integration by AEC envisages the following key characteristics: (a) a single market and production base, (b) a highly competitive economic region, (c) a region of equitable economic development, and (d) a region fully integrated into the global economy. Therefore, Iron &Steel companies should improve feasibility of own about production process, product, human before

2.1 External Influence (Cont.) b. National b1. Policy and Legislation (1) Ministry of Industry issued a new Notification on Industrial Solid Waste Management 8 (2) Ministry of Industry has the investment policy to promote the establishment of upstream processes for Iron & Steel Industry b2. Guidelines/codes of practice Iron & Steel Institute of Thailand (ISIT) has conduct Safety Guideline for Thailand Steel mill b3. Pollution Reduction measures and programs (1) Trend in Waste Management and Recycling Regulations (2) Promotion of Eco-Industrial Parks (ISIT conduct Eco-Town Study For Steel Industry.) (3) Promotion of Sustainable Development for Thai Industry 18

2.1 External Influence (Cont.) c. Public, NGOs and Pressure groups Thailand’s Constitution B.E 2550 (2007) Clause 67 paragraph 2 under human rights subject requires all projects that might cause major harmful to communities in term of natural resources, environment and health to a) make comprehensive study of EIA, HIA and EHIA b) have public participation c) have independent organization on health and environment review before permitting. This subject might cause more active involve in any development in Thailand especially major industry projects. 19

2.1 External Influence (Cont.) d. Surveys, Studies and forecasts. (1) Pollution Control Department developed an Emission Inventory of PCDDs/PCDFs for Enabling Activities of a National Plan for Implementation of the Stockholm Convention on POPs in Thailand. (2) Iron and Steel Institute of Thailand studied energy used in Thai’s steel industry 4 and recheck the pollution emission report for know the situation. (3) Office of Industrial Economics studied Benchmarking for Competitiveness of Thai Industry 20

2.2 In the Steelworks a. Overview a1) More Attention on Social Responsibility of Industry a2) Efforts on the Pollution Prevention The sustainable development is more emphasize after the Johannesburg Implementation Plan based on Agenda 21. Pollution prevention scheme is widely accepted. The common tools are Cleaner Technology, LCI/LCA, and etc. 21

2.2 In the Steelworks b. Process stages not only reducing environmental impact and monitoring but also integrating cleaner technology concept in to the Environmental Management system (EMS) –ISO of the plant 22

R & D activities 1. Recycling Technologies for EAF dust - Thailand has 72,000-90,000 tons EAF dust (red dust) are generated per year according to ~5 million tons steel production (survey (2010): from 14 steel mills) - Iron & Steel Institute of Thailand (ISIT) are also being study about the suitable technology to recycle EAF dust 3 Special Topics 23

- Considerations for Recycling Technology Suit Thailand as follows; - Financial investment, - Operation cost/Consumptions, - EAF dust volume in Thailand, - Environmental impact /Energy saving, - Products quality, Reliability of the process 3 Special Topics (Cont.) 24

2. Slag to fertilizer Application of iron and steel slag to use in agricultural products has been studied by ISIT. Since considered amounts of silicon in slags found to be useful as plant nutrients, the slags appear to be a promising and extensive source of silicon using as fertilizer. 3 Special Topics (Cont.) 25

New Development One Iron and Steel company, in Chonburi, changed the old arc furnace to Shaft furnace Technology that supported by NEDO, Japan, for reducing the electrical power consumption and hazardous waste handing costs. 3 Special Topics (Cont.) 26

4. Conclusion China’s Policy on merging iron & steel plants and exporting raw materials for steel making and intermediate steel products Upstream Processes in Thailand Upstream Processes for Iron & Steel Industry are also being promoted by Thai government in order to recruit high quality steel support target industries i.e. auto industry, appliance, electrical and electronic industry. But Now, Upstream process in Thailand may not possible in Thailand because the people don’t widely understand why it’s important to do in Thailand. Therefore, It should increased the information to stakeholder. 27

4. Conclusion (Cont.) Notification on Industrial Pollution Management (Air, water and waste) might be more stringent i.e. GPS system for waste’s transporter, revision of emission standard, recycling society. Corporate Social Responsibility (CSR: ISO 26000) and efforts on the Pollution Prevention (EMS: ISO 14000) are being promoted among Thai Industry Sustainable Development for Thai Industry is a crucial topic and give a big gap for improvement. 28

Q & A Thanks for Your Attention 29