Scrap imports are still on the rise

The General Department of Customs (GDC) reported a sharp increase in scrap imports from many markets. More than 3.4 million tons, worth $1.22 billion, were imported in the first eight months of the year, an increase of 20.7 percent in quantity and 50.2 percent in value compared with the same period last year.

Japan continued to be the biggest exporter which sold 990,639 million tons to Vietnam, worth $368.64 million, or 28.5 percent of total scrap imports and 30.3 percent of total import turnover, a 1.5 percent decrease in quantity, but a 29.5 percent increase in import turnover.

The second biggest exporter to Vietnam was the US, which provided 594,963 tons, valued at $213.03 million, up by 50.4 percent in quantity and 89.1 percent in import turnover.

GDC’s report showed that imports from the Netherlands soared by 403 times in quantity (61,663 tons) and 602.4 times in revenue ($22.65 million).

The imports from Cambodia also increased sharply by 12.7 times and 20 times to 46,207 tons and $16.03 million, respectively.

Vietnamese enterprises also imported more from Mexico (826 tons, $0.29 million), the UK (92,433 tons, $31.76 million) and the UAE (48,361 tons, $2.86 million).

The surge in scrap imports was big surprise as ministries have vowed to tigh control over scrap imports to prevent substandard waste from entering Vietnam.

However, analysts explained that it was the control tightening which caused the surge in scrap imports. Vietnamese enterprises rushed to import scrap before October 1, because agencies would not grant licenses to import scrap by land and railway.

This is stipulated in the PM’s Instruction No 27 dated September 17, 2018 on measures to strengthen control over the import and use of scrap used as input materials for production.

The instruction also stipulates that the list of scrap eligible for import will be amended in a way so as to prohibit the import of materials that pollute the environment. Vietnam will also take measures to prevent from a distance the import of the scraps which cannot satisfy Vietnam’s environment standards.

Chief of the State Audit Ho Duc Phuoc last September gave a strong warning that if Vietnam doesn’t take actions now to prevent outdated machines and technologies, the country may become a dumping ground in the future.

Sources said the Ministry of Natural Resources and the Environment (MONRE) is considering excluding scrap with the code HS 7204.49.00 from the list of scrap allowed for import. However, the Vietnam Steel Association (VSA) disagrees with the plan.

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Mai Lan