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Steel industry market under pressure in 2015
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Forecast 2015 will continue to be a difficult period for the domestic steel enterprises as production exceeds demand and steel imports from Russia and China put pressure on the domestic market.
According to those working in the steel industry, steel alloys containing boron cheap from China still massively imported, domestic types of steel fell into oversupply, steel from the Russian market is also fear of entering in Vietnam according to the schedule of tariff preferences so enterprises steel production will continue to be a hard year.
Talking to the Saigon Economic Times Online today (16-12), Mr Do Duy Thai, General Director of Vietnam Steel Corporation confirmed the future, if tax steel imports from Russia to Vietnam fell under half trade liberalization Vietnam - Customs Union (VCUFTA) then surely the domestic steelmakers will add things stand.
Steel from Russia ...
According to his analysis of Thai, ability to increase Russian steel imported into Vietnam can easily occur by long-held Russian inherent advantages of steel production, with total output ranked 5th worldwide (70 million tonnes / year ) with low production costs, resources abundant local raw materials, higher technology Vietnam ...
According to Mr. Ho Nghia Dung, chairman of Vietnam Steel Association (VSA), a long time from Russian steel imported into Vietnam mainly steel sheets, steel sheets, steel ... which can not be produced in the country is hardly steel construction.
There were also suggestions that the steelmaker Vietnam should not be too worried about steel imports from Russia by the Russian steel present in Vietnam accounts for only about 6% of Vietnam's steel imports, if tax relief is expected this proportion will only increase by 10 - 12%.
However, according to Mr Do Duy Thai, the previous fluctuation of currency devaluation Russia (ruble) plus the advantages of a free trade agreement between Vietnam and the Customs Union Russia - Belarus - Kazakshtan it is clear that the Russian ability to import massive steel and strangling domestic business is absolutely imminent.
... And from China
Meanwhile, a further difficulty is not small, but the domestic steel producers are facing at the moment is to compete with imported construction steel from China. Only cheap alloy steel containing boron from China into Vietnam still spike, the 2014 Convention can be up to 550000-600000 tonnes.
In a written Ministry of Industry and Trade, Ministry of Finance and Ministry of Science and Technology in late May 11-2014, Chairman of VSA Ho Nghia Dung had to speak: "After 5 months of implementation, the steel association found the implementation of the circular 44 to the import cheap alloy steel containing boron have not been implemented effectively ".
Mr Dung said that the policy of the Chinese Government on VAT refund of alloy steel products for export (from 7-13%), capable of containing Bo steel wire coil imported into Vietnam will increase in the next year.
According to statistics, in the first 11 months of 2014, Vietnam has imported steel up to 10.52 million tons, up 21.1% over the same period last year.
In last November on world market prices of steel raw materials continued a downward trend, trading less. Such as steel scrap fell 5-10 USD / ton compared with last October; steel prices offered in the Southeast Asian market also fell from 10-20 USD / t from late October ...
Adding pressure domestic steel
Thus, before the discount continuity of input materials in the world and steel imports increased, most domestic steel enterprises are forced to cut prices. Northern businesses fell from 200,000 to 350,000 VND / ton, down about 100,000 South / ton and increased discounting to boost consumption of products on the market.
According to VSA, the current total production capacity of Vietnam's steel industry to 22 million tons, including construction steel (10.8 million tonnes / year); Welded steel pipe (2.11 million tonnes); Galvanised kinds (4 million tonnes); Cold rolled steel sheets (4.8 million tons) ... Most of these types of steel are capacity and output reached twice the domestic demand. Vietnam still has to import some kinds of domestic steel production has not been as hot rolled sheet steel, alloy steel, ...
VSA 2015 forecast steel demand in the country has yet to rise much: construction steel reached 5.97 million tonnes close (an increase of 8% compared with 2014); reaching 1.36 million tons of steel pipe (up 15%); Galvanised at 3.25 million tonnes (up 15%); cold rolled steel plate to reach 3 million tonnes (up 15%). Overall, both the steel industry VSA forecast 2015 growth of 11.8% compared with 2014.
To remove difficulties for the domestic steel industry time to come, VSA recently petitioned the functional departments continue to review projects to eliminate steel investment projects is not effective, avoid spreading investment causing an imbalance between supply and demand of domestic steel.
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18/8/2025
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