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Vietnam steel market flooded with import steels

VNBusinessNews.com reported that because the price of domestically made steel is too high, so the steel products especially rolled steel from China, Thailand and Indonesia are flooding the Vietnamese market. In over past one month, the global market has seen a sharp reduction in steel prices due to the surplus of supply whereas the steel price of local market has continuously increased by VND 400,000 to VND 500,000 a tonne. Because of the price difference, a huge volume of foreign made steel now floods Vietnam market.

Currently, domestically manufactured steel is sold at VND 11.6 million per tonne of steel sheet, VND 11.3 million per tonne of rolled steel (VAT exclusive). Particularly, in HCM City, the steel retail prices jumped to VND 12.4 million per tonne and VND 12.1 million per tonne (for both types of steel), up over VND 300,000 per tonne compared with the month early. Meanwhile, the world's steel billet price reduces by USD 40 to USD 60 to USD 490 per tonne from the previous month. More worthily, despite a fall in global steel prices, Vietnam's steelmakers have not had any move for a price reduction.

Vietnam Steel Association announced that to date, 40,000 to 50,000 tonnes of steel (mainly rolled steel) a month are imported to Vietnam. Price of finished steel of China, Thailand and Indonesia to Cambodia is only USD 440 to USD 460 per tonne equaling to VND 7.9 to VND 8.2 million per tonne depending on each kind of steel, much lower than Vietnam's.

Mr Dao Dinh Dong head of VSA southern headquarters' market division said that normally, steel mills in China only turn out 42 to 43 million tonnes a year but recently they expanded the output to 50.7 million tonnes in July and 53 million tonnes in August. China's steel price is on downward because their stockpiled steel output is high. In late 2009, Vietnam's steel sector will have extra 2 million tonnes of steel, bringing total steel production to 7 million tonnes a year while the local consumption demand is 4.2 to 4.6 million tonnes only.

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