June 25, 2021

Empty can cost drifted up 20% following global shortage of steel plate

Since May 2021 steel plate price has drastically shifted up globally, and casted an effect on industrial sectors including canned food manufacturers which rely on tin plate and tin free steel can in their production.
One of the major reason of this continuous shift of steel plate price was from China who is number one steel producer with 50% market share globally. China promoted environmental friendly policy to shut down factories that did not meet environmental standard, and as a result lead to less steel productivity. Chinese government then revoked Rebate tax scheme to discourage steel export from 1st May 2021 to increase the supply domestically due to the fact that the demand in Automobile and Home Appliance sectors has been increasing after China’s economy recovered from Covid-19. Additionally, steel export proportion from Japan and Korea also dropped from 70% to 40% due to factories’ maintenance and improvement to be more environmental friendly and other factors which discourage export activity such as container shortage, higher freight rate, and higher fuel cost.
In Thailand, the cost of empty can has shifted up approximately 15 -20% comparing to last year. Ministry of Commerce has already delayed anti-dumping tax scheme on tin plate and tin free steel for 6 months to aid with the steel plate shortage situation this year, but the shortage situation became much direr from container shortage and higher sea freight rate. To solve the issue quickly, Thai Chamber of Commerce has proposed to Ministry of Commerce to cease the anti-dumping tax scheme to enable Thai suppliers to source steel raw material from elsewhere with lower cost and to urgently find solution for container shortage and high freight rate issue.
 
Reference: https://www.prachachat.net/economy/news-679503
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