Thailand Cement Decarbonization & CBAM 2027 Market Intelligence

Operator playbooks

SCG (Siam Cement Group, SET:SCC) is Thailand's market leader at ~24 Mt cement capacity and ~60% domestic share. The Net-Zero Cement Strategy commits to a 25% Eco SCG (LC3 plus blended) share of cement sales by 2027, scaling to 50% by 2030. Mae Tha and Lampang plants are converting to LC3 production lines through Q3 2026, with capital commitments disclosed in the 2024 sustainability report. SCG's scale advantage extends to a captive calcined-clay feedstock pipeline through SCG Cement-Building Materials subsidiaries, in-house cement R&D centre, and Eco-Concrete and Eco-Insee-blended branded SKUs already in domestic distribution.

INSEE Cement Thailand (Siam City Cement Public, SET:SCCC) operates as the Holcim Group's Thai subsidiary, capturing ~8 Mt capacity and ~25% domestic share. The Holcim parent provides technology transfer for calcined-clay processing, plus access to Holcim's ECOPlanet branded low-carbon cement portfolio. Saraburi plant commissions dedicated calcined-clay capacity through 2026, with a stated target of LC3 share matching SCG's 2027 timeline. INSEE's playbook is technology-leveraged: Holcim ECOPlanet brand recognition in EU and UK markets gives INSEE a CBAM-export advantage versus SCG, but at lower domestic scale.

TPI Polene (SET:TPIPL) holds ~4 Mt capacity and ~12% share but punches above weight on alternative-fuel substitution. Saraburi cement complex is co-located with biomass and waste-heat infrastructure giving TPI a structural advantage on thermal substitution rate (TSR). The 2027 TSR target of ~35% from biomass, refuse-derived fuel (RDF), and tyre-derived fuel (TDF) would put TPI ahead of regional benchmarks. TPI's playbook trades pure LC3 scale for fuel-substitution depth, capturing TGO T-VER carbon credits as a secondary revenue stream while staying below 500 kgCO2/t for CBAM safe-harbour.

Independent traders and importers comprise the long tail. ASEAN-region cement importers (Vietnamese and Indonesian flows into Thailand) plus domestic blenders serving niche specifications occupy a residual ~3-5% share. CBAM exposure on this cohort is minimal because most flows are intra-ASEAN and pre-ICA. Post-2027 ICA implementation, this cohort either consolidates into one of the three majors as a distribution channel or exits niche markets.

Holcim ASEAN (parent of INSEE Thailand) operates as the strategic spine for INSEE Cement Thailand's low-carbon roadmap. ECOPlanet branded low-carbon cement portfolio, calcined-clay process engineering, plus Holcim's global CBAM-compliance trading desk all feed into INSEE's 2026-2027 capacity build. For Thai-domiciled investors and offtake buyers, Holcim parent disclosures (annual sustainability strategy) are a useful read-through to INSEE's pace.

Unit economics, CBAM exposure modelling

Conventional Thai clinker carries ex-works cost of roughly USD 50-65 per tonne, depending on plant scale and fuel mix. CBAM Phase 2 charges EUR 70-95 per tonne CO2 on embedded emissions, with the cement default-value methodology in EU implementing regulation 2023/1773 applying ~0.685 tCO2/t for un-verified Thai sources or ~0.55 tCO2/t for verified-installation reporting. At EU ETS allowance prices in the EUR 75-90 range, the CBAM charge on un-verified Thai clinker lands at roughly EUR 48-62 per tonne — adding ~20-30% to landed cost and erasing conventional-clinker export margin to the EU. Verified-installation reporting cuts the charge by roughly 20 percent, still material.

LC3 chemistry resets the math. At 380-485 kgCO2 per tonne of cement, LC3 carries roughly half the embedded-emissions charge of conventional clinker — EUR 27-43 per tonne CBAM. Ex-works production cost runs USD 5-10 per tonne above conventional due to calcined-clay processing energy and capex amortisation. Net landed margin on LC3 cement into the EU is 8-15% higher than conventional clinker post-CBAM. This is the core arbitrage. SCG, INSEE, and TPI Polene's 2026-2027 capex on LC3 conversion is rational at any CBAM charge above ~EUR 35 per tonne.

TGO T-VER (Thailand Voluntary Emission Reduction) carbon credits stack on top. LC3 substitution and alternative-fuel projects can be registered under T-VER methodology, generating credits that retail at THB 600-1,200 per tCO2 (~USD 17-34) in the Bangkok Carbon Registry Centre voluntary market. For a 1 Mt LC3 plant displacing 300 kgCO2/t versus conventional, that is 300,000 tCO2 of credits — THB 180-360M annually at current prices. T-VER stacking improves LC3 project economics by ~5-8% IRR but does not on its own justify the capex absent CBAM pressure.

BOI Section 8 incentives provide the third layer. Effective Q1 2026, BOI offers eight-year corporate tax holiday plus duty exemption on imported low-carbon-cement processing equipment (calciners, kilns, classifiers). For a USD 60-100M LC3 conversion (typical Mae Tha or Saraburi scale), Section 8 benefits add 200-400 bps to project IRR. Combined with CBAM arbitrage and T-VER stacking, BOI-eligible projects clear 18-22% IRR hurdles. Non-eligible greenfield retrofits clear 12-15%.