The construction materials industry in Southeast Asia is grappling with mounting challenges as foreign factories relocate production bases to the region, often operating under less stringent regulatory and quality standards.
Wiroat Rattanachaisit, chief commercial officer of Cement-Building Materials under Siam Cement Group (SCG), warned the influx of Chinese manufacturers has heightened competitiveness concerns among Southeast Asian companies.
"SCG has called on the government to implement stricter measures and increase the frequency of inspections of Chinese factories in Thailand," he said, stressing the need for equal enforcement of environmental and quality standards.
China's ability to leverage economies of scale has allowed its producers to export massive volumes of low-cost goods, flooding regional markets and pressuring on domestic industries.
In response, SCG reshaped its business model to counter Chinese competition through a solution-driven strategy focusing on cost reduction, operational efficiency, high value-added products, renewable energy adoption, green product development, artificial intelligence and automation, as well as expansion into new export markets, said Mr Wiroat.
SCG Cement-Building Materials operates in three regional markets -- Thailand, Vietnam and Indonesia -- and exports products such as low-carbon cement to the US (600,000–700,000 tonnes annually) and building materials to Australia. The company's portfolio consists of 50% high value-added products, 30% green products and 20% other offerings.
Looking ahead, SCG expects Thailand's construction sector to strengthen in the second half of 2026, supported by government budget disbursements and infrastructure investment projects.
"Government infrastructure investments still drive demand for cement and building materials, alongside steady growth in repair projects," Mr Wiroat said.
However, the private real estate sector is slowing, with mortgage rejection rates exceeding 50% for homes priced less than 3 million baht.
Thailand's cement industry also faces a glut, with installed production capacity of 75 million tonnes per year, yet output of roughly 30 million tonnes.
Regional markets remain uneven as the southern construction sector is weighed down by a stagnant hotel segment and sluggish luxury villa projects, compounded by declining tourism from Malaysia, China, Europe and Russia, as well as rising travel costs.
