The increase in Vietnamese steel production could affect global markets in 2019

Strong steel exports from Vietnam, combined with increased domestic production, are expected to affect the global steel trade landscape in 2019.

 Although steel exports were affected by the us section 232 tariff, Vietnam’s steel exports to the us increased significantly in 2018, unlike other Asian countries whose exports declined.

 Vietnam exported 1.11 million tons of steel to the United States in 2018, up 48 percent from 2017, according to the US Census Bureau.

 The US imported 25.69m tonnes of steel last year, with Vietnam accounting for about 4.3 per cent.

 One reason for the increase in south Vietnam’s Steel exports was increased production by Formosa Ha Tinh Steel Corp.On May 18, 2015, the company’s second blast furnace went into operation, doubling its crude steel capacity to 7 million tons.Formosa Plastics owns 70 per cent of Formosa Plastics, 20 per cent of sinosteel and 5 per cent of JFE Steel.

 While us steel imports for 2018 fell 13.1 per cent year-on-year to 25.69 million tonnes, imports from Vietnam accounted for a significant increase from 2.5 per cent in 2017 (about 749,000 tonnes).

 Vietnam exported 6.26 million tons of steel in 2018, up 33 percent from 4.71 million tons in 2017.Over the same period, the country imported 13.5 million tons of steel, down about 10 percent from 15 million tons in 2017.

 Data from the Vietnam iron and steel association showed that Vietnam’s steel imports and exports had reversed year-on-year trends, mainly due to a 14.9 per cent year-on-year increase in steel production last year to 24.19 million tonnes.

 Vietnam saw the biggest increase in hot-rolled coil production last year, to 3.44 million tonnes, up nearly 1.5 times from 1.38 million tonnes in 2017, according to the data.

 Vietnam’s largest steelmaker, Hoa Phat Group, is expected to maintain steel production in the first quarter of 2019, market sources said.The company plans to complete construction of the Dung Quat steel mill by the end of this year, gradually putting all four of its blast furnaces into production.The plant is designed to have a crude steel capacity of 4 million tons per year, half of which will be used to produce hot rolled steel coils.

 A report on Vietnam’s steel industry, released by Citi Research on the 7 March, shows that in judging global steel production trends, it is necessary to focus on production growth in countries that are non-traditional producers but could alter the global steel trade balance.

Post time: Mar-14-2019
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