Thailand Plans to Bin "Dirty" Steel Production Over Quality and Pollution Fears

Thailand's Industry Ministry is pushing ahead with plans to scrap certification for steel produced using outdated Induction Furnace (IF) technology, citing persistent difficulties in quality control and significant environmental concerns.

The move follows investigations linking IF steel to substandard products and criticism from the State Audit Office (STO).

Industry Minister Akanat Promphan announced that the ministry would review the certification standards for steel manufactured via the IF process, a method known for its limitations in removing impurities from molten steel.

Furthermore, IF furnaces are open-system, contributing to higher levels of dust and toxic gas emissions compared to more modern methods.

While theoretically capable of producing quality steel, the Minister emphasised that achieving consistent quality in practice is a significant challenge, requiring rigorous attention to high-grade raw materials and meticulous quality control processes by manufacturers.
 

Thailand has recognised steel reinforcing bars produced by IF under the Thai Industrial Standard (TIS) since 2016, with producer SKY receiving certification in 2018.

However, the ministry has since suspended production and sales, and impounded steel from numerous companies – including SKY – found to be producing substandard material, all of which utilised IF technology.

This, according to the ministry, highlights the inability of IF steel producers to guarantee the quality of their raw materials.

In contrast, Electric Arc Furnace (EAF) technology, which uses electricity to melt steel, offers superior impurity removal, operates as a closed system with reduced dust and gas emissions, and provides more reliable and consistent quality control.

Discussions with the Iron and Steel Industry Association and the Federation of Thai Industries have revealed that Thailand's existing EAF steel production capacity of 4.3 million tonnes comfortably exceeds the national demand for steel bars, which stands at 2.8 million tonnes.

This surplus supports the consensus that IF steel production should be phased out. Under the Industrial Product Standards Act (TIS Act), the Thai Industrial Standards Committee (TISC) can, in cases of urgent necessity to prevent harm to the public or the economy, consider and resolve to revoke standards. 

The Minister of Industry can then issue a ministerial announcement to amend or abolish the certification for IF steel, in accordance with the legal framework.

"I have signed the letter instructing the Permanent Secretary of the Ministry of Industry, in their capacity as Chairman of the TISC, to put the review and potential revocation of IF steel on the agenda for consideration," Akanat confirmed.

 

Akanat also addressed the issue of substandard steel produced by Xin Ke Yuan Steel Co., Ltd. (SKY), whose factory was closed in December 2024.

He noted several suspicious aspects of the company's operations, particularly the "red dust" problem, which has led to the extension of investigations into the withdrawal of Board of Investment (BOI) privileges and joint inquiries with the Department of Special Investigation (DSI).

Court warrants have been obtained to secure evidence for further legal action.