VietNamNet Bridge reported that Vietnam's four ingot steel producers, Dinh Vu, Van Loi, Hoa Phat Steel Corporations and Hung Yen Mechanical Joint Stock Company, have sent a petition to the ministries of finance, and industry and trade, asking for the import tax on ingot steel to be raised from 5% to 17%. They said that ingot steel output is expected to be abundant this year due to the decrease in domestic consumption. Meanwhile, production capacity has increased significantly. The total capacity of ingot steel mills has reached 2.7 million tonnes a year.
It is expected that in 2009, several more ingot steel mills will become operational, raising the total ingot steel capacity to 5.5 million tonnes. The supply is believed will be high enough to meet domestic and export demand. Currently a lot of countries and territories are offering to sell ingot steel to Vietnam, including Russia, Taipei China and Turkey, which has made ingot steel producers suffer. A lot of mills have had to stop production. However, the Vietnam Steel Association still thinks that it is necessary to consult with relevant parties on the issue before submitting the final proposal to the ministries. The proposal needs to be designed in a way to ensure the benefits of both steel and ingot steel producers. Mr Pham Chi Cuong chairman of Vietnam Steel Association said that the ingot steel offered by Russia and the Ukraine is now USD 290 per tonne. As such, the price is some USD 320 per tonne if counting other expenses, which is USD 100 per tonne lower than the price at the end of February 2009. Mr Cuong said that with such an import price, domestic ingot steel producers cannot compete with imports. Scrap steel, the main material for making ingot steel, is now USD 250 per tonne.