AsemconnectVietnam - The price of construction steel is on the rise despite the fact that the demand for this type of construction material remains weak, insiders have said.

The selling price of steel in Hanoi is 18 million VND (761 USD) per tonne, which is approaching its peak recorded in mid-2022.
Nguyen Van Sua, a steel industry expert, said that this year the steel price may not reach its peak as in 2022, but it is on the rise because the actual demand is not high.
Production and sale of the steel industry depend heavily on the implementation of real estate, bridge and road projects. However, these projects are at standstill currently, he said.
Hoang Cuong, an iron and steel dealer on Tam Trinh Street, Hanoi’s Hoang Mai district, said since the beginning of this year, steel prices have increased 7 times, with a total increase of about 1.2 million VND per tonne.
According to him, the price of billet and raw materials has increased, so manufacturers adjusted the selling price of finished steel.
A representative of a steel firm said that the demand for real estate is low while the cost of input materials remains high, thus, the selling price is raised to reduce losses.
According to the Vietnam Steel Association (VSA), the selling price of finished steel has increased slower than the growth rate of input materials, affecting the performance of steelmakers.
Hoa Phat Group said that in the first two months of 2023, the sale of steel products in the domestic and foreign markets both decreased over the same period.
Specifically, the group sold 282,000 tonnes of construction steel in February, down 37% year-on-year. It supplied the market with 186,000 tonnes of hot rolled coil (HRC) steel in the month, more than two times higher than the previous month but declined by 20% year-on-year.
Vietnam extends safeguard measure on long steel products, cancels that on steel billet
According to a notice issued by the Ministry of Industry and Trade of Vietnam on March 21, 2023, Vietnam decided to extend the safeguard measure on alloy and non-alloy long steel products, valid for another three years.
The safeguard duty for long steel products is 6.3% for the period from March 22, 2023 to March 21, 2024, 6.2% from March 22, 2024 to March 21, 2025, and 6.1% from March 22, 2025 to March 21, 2026. The duty will be lowed to zero after March 22, 2026.
The long steel products involved are classified under HS codes 7213.10.10, 7213.10.90, 7213.91.20, 7214.20.31, 7214.20.41, 7227.90.10, 7227.90.90, and 7228.30.10.
On the contrary, the safeguard measure on steel billet products will be no longer applicable. The billet products are under HS codes 7207.11.00, 7207.19.00, 7207.20.29, 7207.20.99, and 7224.90.00.
This determination takes effect from March 22, 2023.
Formosa Ha Tinh Steel might increase prices for May
Vietnam’s Formosa Ha Tinh Steel Corporation (FHS) hiked its hot-rolled steel and wire rod price for April by US$62/ton and US$50/ton, respectively. According to FHS, Vietnam's local demand still didn't have obvious increases but export performance for Europe was good.
European mills' steel plate price has risen by US$180/ton since early of 2023. The second quarter is a traditional peak season, so an obvious recovery in the steel market is expected.
The current iron ore and coal prices are at high levels. China's Baosteel also hiked its price for April. Affected by the above factors, steel prices were supportive in Asia. It was expected that FHS will be very likely to increase the prices for May.
Vietnam’s Hoa Phat raises hot-rolled steel price for Apr
After Vietnam’s Formosa Ha Tinh Steel Corporation (FHS) announced to hike hot-rolled prices by US$62/ton for April, Hoa Phat Group also increased its prices by around US$40-50/ton for April, which has been raised by about US$100 in two months.
The price difference between Ha Tinh Steel and Hoa Phat is merely US$15-20/ton currently. Supported by costs, Ha Tinh Steel was expected to further increase its prices for May in the middle of this month.
Domestic steel enterprises suffer falling demand
The high prices of raw materials have caused domestic steel companies to increase selling prices many times to compensate for production costs and reduce losses.
In the context of weak domestic steel demand and rising costs pushing up global commodity prices, the selling prices of finished steel are increasing slower than the prices of input materials.
Analysts say that the business performance of construction steel companies is still insignificant.
According to the Vietnam Steel Association (VSA), steel prices have continuously increased mainly due to the fact that input prices of input materials for steel production such as coal, iron ore, scrap steel, and hot-rolled coils are still climbing.
VSA believes that the high prices of raw materials have caused domestic factories to increase selling prices many times to compensate for production costs and reduce losses.
T.Huong
Source: Vitic/Yieh