Steel enterprises have boosted exports while facing difficulties in domestic consumption due to the COVID-19 outbreak, according to the Vietnam Steel Association (VSA).
|Vietnam's steel exports reached 658,207 tonnes in the first seven months of this year, an increase of 5.96 per cent month on month. Photo vinanet.vn|
The association said steel production in July reached nearly 2.4 million tonnes, down 6.48 per cent compared to the previous month, while steel consumption was about 2.1 million tonnes, the same volume in June and up 7.4 per cent year on year.
Of which, steel exports reached 658,207 tonnes, an increase of 5.96 per cent month on month, and 55 per cent year on year.
Trang Thu Ha, chief of VSA Administrative Office, said the domestic steel industry has faced difficulties in production and sales due to the impact of the COVID-19 pandemic and the weather.
Construction work was temporarily postponed in the first seven months of the year, leading to difficulties in the domestic steel market, especially in the southern region.
Construction steel sales in the first seven months increased by 6.4 per cent year on year, of which, exports rose by 25.4 per cent.
Meanwhile, hot rolled coil production reached more than 590,000 tonnes in July, down by 1.21 per cent month on month but increased by 85.4 per cent year on year. Consumption of this product reduced by 6.8 per cent to 559,487 tonnes but this figure surged by 82.7 per cent over the same period in 2020.
Consumption of colour-coated metal sheets in July reached 428,084 tonnes, down 6.58 per cent month on month, though up 18.8 per cent year on year. This figure included 300,404 tonnes for export, up 84.2 per cent over the same period in 2020.
Hoa Sen and Nam Kim Group were leading in steel consumption in the first seven months. Hoa Sen sold nearly 1.1 million tonnes, holding 36.7 per cent of the domestic market share. Nam Kim sold more than 498,000 tonnes, ranking second with 16.8 per cent of market share.
The Hoa Phat Group's galvanised sheet and steel pipe products also recorded a strong increase because of the recovery in demand of those products in the US and Europe.
Due to the difficulties in the steel product consumption in the domestic market, steel enterprises have promoted steel exports to maintain production.
Ha said that in 2020, the domestic steel production industry maintained operations due to good control of the pandemic.
However, with the complicated development of the outbreaks this year, many provinces and cities have been implementing social distancing measures and even had to stop temporarily many activities, weakening the domestic market demand in June and July.
“Therefore, the association forecasts that steel consumption in the third quarter will not be better. The business result in the fourth quarter will also depend on the pandemic prevention and control," Ha told the Vietnam News Agency.
With the complicated development of the pandemic in the southern provinces and cities, the association expects that steel production and consumption by year-end would continue to see difficulties, she said.
However, "domestic consumption and steel exports could recover further by the end of this year if the pandemic is controlled well at home and abroad," she said.
Meanwhile, the Ministry of Industry and Trade has requested the association and enterprises producing and exporting iron ore, iron and steel to review input materials for reducing production costs and selling price in the process of stabilising steel production and the domestic steel market at present.
Source: Vietnam News
Steel has hit a new high after a series of rapid price increases from May through June 2021 when they increased by more than 50 per cent compared to the beginning of the year.
Vietnam exported a total of 4.88 million tonnes of iron and steel worth US$3.61 billion during the five months of the year, with China emerging as the largest buyer, according to the General Department of Vietnam Customs.