Page 12 - Annual report eng 2020

Tycoons Worldwide Group (Thailand) Plc.

speed up EEC, the flagship project, Thai government has invoked the powerful Section
44 to enable authorities to bypass some laws and regulations that may put the project on
hold. EEC Projects that has been launched in 2018 include high speed rails linking 3
international airport, Laem Chabang port phase 3, U-tapao airport, Map Ta Phut's port
expansion and development of highways and double-track rails in the three EEC
provinces. Other projects are eastern airport city, aircraft repair and maintenance hub at
U-tapao and the Bangkok-Rayong high-speed rail network. Domestic steel demand will
benefit from the launch of those infrastructures before the end of 2021. Therefore, the
outlook of Thailand’s steel market is expected to bloom in the future.

Bans on Thai steel plant expansion

Steel plant expansion and construction of steel bar plants will be banned for the next
five years in Thailand to reduce the domestic surplus, according to an industry Ministry
draft regulation the cabinet approved on Jan 29, 2019. The government calls on
steelmakers to improve their technology, upgrade steel quality to meet high standards and
solve SOx and NOx emission levels to prevent outdated technology from polluting
surrounding communities. The new regulation has entered into force on January 11,
2020.

“Made in Thailand” policy
Domestic steel demand will grow under the “Made in Thailand” policy announced
recently in January 2021 by the Comptroller-General. Under the policy (Local Content),
government agencies have to procure not less than 60 per cent from domestic produce
products and have to procure not less than 90 per cent from domestic produce iron or
steel of the total value or quantity of government construction projects which FTI the
certify party has included steel in the products list. The policy is expected to be effective
in February and will give an impetus to use of local steel in construction work.

New capacity in neighboring countries
Vietnam has complete new steel plant with annual capacity of 7.1 million tons in early
2018, Malaysia Alliance Steel also completed a steel plant with an annual capacity of 5
million tons in the first quarter of 2019, The excess capacity from these two countries
was dumped to Thailand in 2019, causing Thai steel prices to fall. The company has join
with others steel making factory and submitted anti-dumping investigations in these two
countries to the Thai government in order to curb improper low-price dumping.

2.3 Procurement of products/services

1. Production

The company could achieve maximum production capacity of 500,000 tons/year if it
were to produce only a single type of wire rod (that used for bar in coils), since it is
less time consuming to make than other types of wire rods. Actual capacity will be
lower, at approximately 360,000 tons/year, if the company produces a combination of
mixed product range with different grades. And the company also could achieve
maximum production capacity of 144,000 tons/year if it were to produce only a single

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