A
worker inspects steel billets at a Việt Đức Steel JSC. steel mill in northern
Vĩnh Phúc Province. VNA/VNS Photo Trọng Lập
HÀ
NỘI — Overreliance on input material imports, small production value and
outdated technology were among the major weaknesses of Việt Nam's steel
industry, said a recent report by the Ministry of Industry and Trade.
The
report was part of the ministry's proposed "Strategy for the development
of Việt Nam's steel industry by 2030, with a vision to 2050",
which called for additional governmental policies to support the steel
industry.
According
to the ministry, Việt Nam's production capacity for steel billets stood at 27
million tonnes in 2021, of which 7-8 million tonnes was hot-rolled coil. With
the exceptions of only a handful of large steel mills such as the Hòa Phát-Dung
Quất Iron and Steel Complex, the Hưng Nghiệp Formosa Iron and Steel
Complex and Nghi Sơn Steel, the rest of the country's steel industry was made
up of small mills, equipped with outdated machinery and technology.
In
addition, the industry lacked the capacity to meet domestic demand, especially
for alloy steel which it has not been able to produce. The only long-term
solution is to ramp up investment for the construction of large-scale steel
complexes to reduce reliance on imports.
The
ministry's conclusion was that the industry's competitive capacity is
limited as its production was marred with energy inefficiency and environmental
issues.
"For
the most part, the industry is overly dependent on imports of raw materials
including ore, scrap and coking coal, resulting in unstable prices,"
said the report.
By
the ministry's estimate, Việt Nam needs to import around 18 million tonnes of
ore, 6-6.5 tonnes of scrap and 6.5 million tonnes of coking coal this
year. As prices for said materials remained high, the steel price is expected
to climb, hurting both domestic consumption and exports.
The
ministry said the development of Việt Nam's steel industry remained a key
component in the country's industrialisation effort as a large number of
industries including shipbuilding, manufacturing, defence hardware, mining and
energy are highly dependent on quality steel.
By
2030, Việt Nam's total demand for steel was projected to reach over US$310
billion, of which automobiles alone account for $120 billion, industrial
construction $120 billion, railways $35 billion and subways $10 billion, among
others.
Despite
its key role in the country's socio-economic development effort, the industry
has not received adequate support, especially from a policy standpoint, due to
a lack of tailored and streamlined policies to support its growth, said
minister of industry and trade Nguyễn Hồng Diên.
Diên
called for stronger government support for the sustainable and stable
development of the industry as well as the country's metallurgy sector with a
focus on increasing production of hot-rolled coil, high-quality steel and the
establishment of steel megacomplexes. —VNS