HÀ
NỘI — Steel prices have been steadily on the decline in the last few weeks as
prices for raw materials dropped on the global market, according to the Vietnam
Steel Association (VSA).
VSA
reported prices for iron ore have gone down to US$139 per tonne, a $16
decrease from prices at the beginning of April, and a $71-73 decrease from the
record-breaking prices reported in May 2021 at $210-212 per tonne. Meanwhile,
prices for steel scrap have also seen a significant drop to $530 per tonne, a $94
decrease from early April. Hot-rolled coil has fallen to $797 per tonne, an $81
decrease.
Since
the beginning of the year, demand for steel in the domestic market has been
high as economic recovery was in full swing. Steelmakers, taking full advantage
of robust demand, also raised their prices on the pretext of higher input costs
of imported raw materials.
However,
a sharp fall in demand in China due to extensive social distancing measures
employed by Chinese authorities in recent months has forced Vietnamese
steelmakers to lower prices to clear their inventory, bringing steel down to an
average of VNĐ18.25-18.50 million per tonne.
Hòa
Phát steel has gone down by VNĐ4.6-8.0 million per tonne, Việt Đức steel by
VNĐ5.1-7.6 million, Thái Nguyên steel by as much as VNĐ8.1 million per
tonne.
According
to owners of metal stores in Hà Nội, while steel has gone down from its
over-VNĐ20 million per tonne mark in March, it remained quite high compared to
the end of 2021. Recent price drops have not managed to bring steel down to the
previous price level after four consecutive price hikes since the beginning of
the year.
Vietnamese
steelmakers together produced more than 11.4 million tonnes of steel during the
first four months of 2022, a 2 per cent increase from the same period last
year. Of which, 10.6 million tonnes were sold, a 4 per cent increase
year-on-year with 2.5 million tonnes exported.
According
to the VSA, for the time being, Vietnamese makers were able to meet all
domestic demand. However, the country could only supply 20-30 per cent of raw
materials, making Vietnamese steel prices largely dependent on the global
market.
By
the association's estimate, Việt Nam will have to import as much as 18 million
tonnes of iron ore, and 6.5 million tonnes of scraps and coking coal in
2022.
In
the short run, cheaper steal would mean the country's much-needed
infrastructure projects could now progress with less pressure from soaring
material prices, of which steel alone typically accounted for 20-30 per cent.
VNS