Thai cement producer relies on strong petrochemical demand for growth
Demand for petrochemical products in Asia is likely to show robust growth over the course of this year, helping Thailand's largest cement manufacturer, Siam Cement Plc, to offset the losses incurred by subdued demand for its core products as a result of the political unrest in the country.
The rise in demand for cement is predicted to drop below last year's level of 7%, but since Siam is also the biggest producer of downstream chemicals for plastics it can still rely on overall growth, thanks to increased demand for petrochemicals, Reuters reported.
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Siam's chief executive officer Kan Trakulhoon stated at an earnings briefing that the outlook for the petrochemicals market was positive, as demand in Southeast Asia has been rising in line with the global economic recovery. Although he did not give any specific figures, he pointed out that the weak domestic currency will be positive for the company's petrochemical products exports. This may be offset somewhat by increasing fuel costs, he added.
Thailand's capital, Bangkok, has been in the midst of anti-government protests since November. As a result, the local baht currency has weakened against the U.S. dollar, reaching its lowest level in almost four years. This has caused the Thai central bank to revise its economic growth prediction from four percent to about 3%, Reuters said.