Steel sales in Vietnam are growing due to exports

According to the Vietnam Steel Association (VSA), steel mills have boosted exports after facing difficulties in domestic consumption due to the COVID-19 outbreak.

The association said July steel production reached nearly 2.4 million tonnes, down 6.48 percent from the previous month, and steel consumption was around 2.1 million tonnes, in line with June and 7 , A 4 percent increase over the same period last year.

Of these, steel exports reached 658,207 tons, up 5.96 percent on a monthly basis and 55 percent on an annualized basis.

Chang Thu Ha, head of administration of the VSA, said the domestic steel industry faced difficulties in production and sales due to the impact of the COVID-19 pandemic and weather conditions.

Construction work was temporarily delayed in the first seven months of the year, which led to difficulties in the domestic steel market, especially in the southern region.

Sales of construction steel rose 6.4% year-on-year in the first seven months, of which exports were up 25.4%.

Meanwhile, hot coil production in July was over 590,000 tonnes, down 1.21% from the previous month, but up 85.4% year on year. Consumption of this product decreased by 6.8% to 559,487 tons, but this figure increased by 82.7% compared to the same period in 2020.

Color coated sheet metal consumption in July was 428,084 tonnes, down 6.58% from the previous month, but up 18.8% year on year. This figure includes 300,404 tons for export, which is 84.2 percent more than in the same period in 2020.

Hoa Sen and Nam Kim Group led the way in steel consumption in the first seven months. Hoa Sen sold almost 1.1 million tons, which is 36.7 percent of the domestic market. Kim sold over 498,000 tonnes to Nam, ranking second with 16.8% market share.

The Hòa Phát Group's products in galvanized sheet and steel pipes have also grown significantly due to the recovery in demand for these products in the US and Europe.

Due to difficulties with the consumption of steel products in the domestic market, steel mills stimulated steel exports to support production.

Ha said that in 2020, the domestic steel industry continued to operate thanks to good control of the pandemic.

However, due to the complex development of the outbreaks this year, many provinces and cities have applied social distancing measures and were even forced to temporarily suspend many activities, which weakened domestic demand in June and July.

“Thus, the association predicts that steel consumption in the third quarter will not be better. Business results in the fourth quarter will also depend on measures to prevent and combat the pandemic, ”Ha told the Vietnam News Agency.

According to her, due to the complex development of the pandemic in the southern provinces and cities, the association expects that the production and consumption of steel will continue to experience difficulties by the end of the year.

However, “domestic steel consumption and exports could recover even more by the end of this year if the pandemic is well controlled domestically and abroad,” she said.

Meanwhile, the Ministry of Industry and Trade has asked the association and enterprises producing and exporting iron ore, iron and steel to revise the raw materials to reduce production costs and selling prices while stabilizing steel production and the domestic steel market at present.