Vina Roma offers Vietnam to build a plant for the production of thick steel

Vina Roma Quang Tri Steel joint-stock company has put forward a proposal to build a steel plant with a capacity of 4.5 million tons per year in Quang Tri, central Vietnam. The provincial government announced on May 27 that the proposed Quang Tri Iron and Steel Complex will produce structural steel, section steel, and steel plate using European technology.

The steel plant, which will be built within five years and occupy about 463 hectares in the Triu Phong area, will require an investment of about VND 47,000 billion (US$2 billion), divided into VND 15,000 billion, VND 9,000 billion and VND 23,000 billion dongs each. the corresponding phase.

The first phase is to start 2.5 years from the investment approval date, followed by the second and third phases.

Industry sources are surprised by the announcement and question funding for the project. The lead investor is reportedly working in the energy sector.

“This could worsen the already overcapacity,” says a source in Hanoi. According to the Vietnam Steel Association, the country's apparent steel consumption is 24 million tons/year, and the crude steel production capacity is 25 million tons/year. 5.6 Mtpa production expansion (see separate HRC report), this would push Vietnam's crude steel capacity to over 30 Mtpa, but the source notes that not all announced proposals for new steel mills are being implemented.

But the trader disagrees. “The plate mill is fine because there is no plate production in Vietnam right now,” says a trader from Ho Chi Minh City. He notes that excess steel production capacity is mainly related to long products.

Meanwhile, Vietnam's thick plate import market is currently very slow. “Demand is very weak,” says a trader in southern Vietnam. 12-40mm thick A36 sheet of Chinese origin has recently been offered at US$800-805/t in Vietnam.