The latest US trade probe against imported Chinese steel is expected to force Chinese steelmakers to switch their focus to Thailand and the Asean market, raising concerns among the region's steel producers.
They are now considering asking their governments to hold talks with Chinese authorities to prevent an influx of steel into Asean, according to the Thailand Iron and Steel Industry Club under the Federation of Thai Industries (FTI).
US President Donald Trump earlier this week announced the launch of a trade probe against China and other exporters of cheap steel to the US market, raising the possibility of new tariffs that could bar Chinese steel imports.
The chairman of the club, Vikrom Wacharkrup, said the US measure was expected to force Chinese steelmakers to turn to Asean markets, including Thailand, where demand for steel is rising.
"More Chinese steel is expected to be dumped into Thailand and Asean, which will definitely hurt local producers," Mr Vikrom said.
He said Thai and Asean steel producers have periodically set talks with their Chinese counterparts over the past several years, and the potential US ban on Chinese steel had been raised during a meeting last month.
But no concrete measures resulted from that meeting, raising fears among local producers about an influx of cheap Chinese steel into Asean.
"We have seen signs of rising Chinese steel imports during the first two months of this year," Mr Vikrom said. "But we need to check with the Customs Department to determine whether it is Chinese steel."
He said cheap Chinese steel normally comes to Asean by two ways: it is imported directly from China or it is brought in through Vietnam.
The Thai steel industry is not yet in the clear after having faced several years of oversupply, mostly from China, at a time when local demand was not very strong, forcing local steel companies to ask for anti-dumping measures from the government to briefly stop the influx of cheap steel.
But because of World Trade Organization regulations, which only allow member countries to impose safeguards and anti-dumping measures for a limited period of time, producers have failed to protect themselves in the long run.
Analysts and the FTI have recommended that local steelmakers overhaul the industry by upgrading their production technology to produce high-value steel and develop their own upstream steel industry to have better-quality raw materials.