Thai Authorities Intensify Investigation into Substandard Steel Concerns

 

Officials at Thailand's Ministry of Industry are set to collect further steel samples from the site of the collapsed State Audit Office (SAO) building this Friday, as concerns mount over the quality of construction materials. 

 

This development follows the discovery of a significant and suspiciously increased quantity – over 45,000 tonnes – of red dust at a factory in Rayong province where substandard steel had been impounded.

 

Phongphon Yodmuangcharoen, spokeperson of the Minister of Industry, reiterated the firm stance of Minister Eknatt Phromphan, stating that the case of Xin Ke Yuan Steel is being pursued as a "special case" under the Hazardous Substances Act.

 

This signifies the seriousness with which the authorities are treating the matter.

 

Furthermore, the Ministry is moving forward with the process of revoking the investment privileges granted by the Board of Investment (BOI) to Xin Ke Yuan. Measures to tighten future controls within the industry are also being reviewed.

 

"Our job is to check if it meets the standards. We can't definitively say the SAO building collapsed because of the steel – other agencies will contribute to that assessment. It wouldn't be right to blame substandard steel alone," Phongphon explained. "Therefore, tomorrow, the 11th of April, 2025, I and our officials will visit the SAO site to gather more steel samples to ensure the most robust and thorough investigation. Steel that has already been tested will not be re-tested; once it fails under Thai Industrial Standards Institute (TISI) regulations, repeated tests are not permitted."
 

 

Phongphon Yodmuangcharoen

 

The ongoing investigation has also unearthed some unusual discrepancies. While the electricity bill for the factory has seen a significant drop from 130 million baht a month to the hundreds of thousands, the reduction in the water bill has been minimal, prompting further questions that Xin Ke Yuan will be required to answer.

 

Between November 2024 and March 2025, the Ministry's task force seized substandard steel round bars, deformed bars, and structural steel from seven manufacturing plants across Chonburi, Rayong, Prachinburi, Nakhon Ratchasima, and Sa Kaeo provinces. 

 

These included four joint ventures with foreign firms and three Thai-owned operations, with the total value of the confiscated goods exceeding 361 million baht.

 

"Previously, the Ministry wrote to Xin Ke Yuan seeking clarification on which distributors received the problematic steel batches. However, the response was simply that they did not directly sell steel to the SAO construction project and therefore couldn't provide details. This lack of useful information is concerning for the public, who are understandably worried about whether substandard steel might be present in other buildings," Phongphon stated. "The Ministry will now task TISI with considering whether this refusal to cooperate constitutes an offence under Section 56 of the Industrial Product Standards Act. Similarly, a clear response regarding the red dust possession is still awaited from Xin Ke Yuan."

 

In a related development, Industry Minister Akanat Promphan has instructed TISI to examine potential revisions or the outright cancellation of TISI standards 20 (round steel bars) and 24 (deformed steel bars) for steel produced using Induction Furnace (IF) technology. 

 

 

This older method has faced widespread criticism regarding the quality and purity of the steel, and the move aims to bolster the safety and consistency of Thai steel bar standards in the future.

 

 

Addressing news reports about a supposed TISI licence renewal for Xin Ke Yuan Steel in January 2025, the Ministry firmly denied this as inaccurate. The company is currently under a pre-suspension warning, issued on February 20, 2025, under Article 40 for failing to meet standards in tested steel bars, prohibiting their production and sale. 

 

TISI has confirmed that the licence has not been renewed as reported.

 

On Wednesday, the Sudsoi team led by Thitipat Chotidechachainan, the head of the working group of the Minister of Industry, and TISI officials met with forensic experts from the Department of Special Investigation (DSI) and the Department of Public Works and Town & Country Planning to coordinate evidence gathering at the collapse site.

 

The aim is to streamline the process and clearly define roles to maximise efficiency. Following an initial site visit and task allocation, a schedule for inspections by various agencies has been established, with the Department of Public Works and Town & Country Planning taking the lead.

 

TISI is scheduled to collect further steel samples from the site this Friday.

 

The Ministry of Industry and relevant agencies will now work together, sharing information and providing mutual support to pursue legal action against the steel manufacturer under their respective jurisdictions.

 

The DSI is able to take on the case as a special investigation due to its complexity and potential impact on the wider economy. This case is being presented as a model for government agencies tackling "zero-dollar" businesses in Thailand, and the Ministry of Industry has vowed to take the strongest possible legal action against the factory if any breaches of regulations are discovered.