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Vietnam seel market in 2024 and forecast for 2025 

 Monday, January 27,2025

AsemconnectVietnam - 1. Price Trends: Mild fluctuations were observed in the steel market during 2024, influenced by supply-demand dynamics and macroeconomic factors.

• Early 2024:
o Domestic steel prices showed a slight upward trend due to stable demand from construction and infrastructure projects, supported by large-scale public investment initiatives.
o However, import competition from major exporters like China, India, and South Korea put downward pressure on domestic steel prices.
o Import tariffs and protective measures were maintained to safeguard the local steel industry.
• Mid-2024:
o Rising production costs, especially for raw materials like iron ore and coking coal, constrained domestic producers.
o Demand from key steel-consuming sectors such as automotive, electronics, and shipbuilding slightly declined, causing market stagnation.
• Q3 and Q4 2024:
o Prices stabilized and slightly increased due to a recovery in production and consumption.
o Demand from large-scale infrastructure projects in major cities like Hanoi, Ho Chi Minh City, and economic hubs provided critical support for the market.
o However, challenges such as high interest rates, energy costs, and supply chain issues continued to exert pressure.
2. Raw Material Prices
• Scrap Steel:
o Weak demand and cautious buying behavior from both suppliers and buyers caused price stability.
o H2 scrap prices were quoted at 330–335 USD/ton CFR, with lower bids at 320–325 USD/ton CFR.
• Hot Rolled Coil (HRC):
o Prices softened as local producer Formosa Ha Tinh Steel (FHS) reduced domestic prices for February 2025 shipments:
 For orders of 20,000+ tons: 13,145 VND/kg (519 USD/ton).
 For smaller orders, prices ranged from 522 USD/ton to 531 USD/ton CFR.
• Billet Steel:
o As of December 20, 2024, blast furnace billets (BF) were quoted at 455–460 USD/ton FOB, with limited transactions due to high regional prices.
3. Finished Steel Products
• In December 2024, steel prices rose slightly due to increased demand from construction projects during the year-end building season.
• Construction Steel Prices (as of December 21, 2024):
o Northern Region:
 Hòa Phát CB240: 13,690 VND/kg, up 100 VND/kg from November.
 Việt Ý CB240: 13,640 VND/kg, up 110 VND/kg.
o Central Region:
 Hòa Phát CB240: 13,690 VND/kg, up 110 VND/kg.
 Việt Đức CB240: 13,940 VND/kg, down 50 VND/kg.
o Southern Region:
 Hòa Phát CB240: 13,690 VND/kg, up 110 VND/kg.
 VAS CB240: 13,700 VND/kg, up 200 VND/kg.
4. Supply Trends
• Production:
o Despite intense competition from imports, domestic production of construction steel and HRC remained robust, driven by infrastructure projects and automotive demand.
o Major producers like Hòa Phát, Pomina, and Việt Đức focused on improving technology and quality to maintain market competitiveness.
• Imports:
o In November 2024, steel imports totaled 1.46 million tons, valued at 1.027 billion USD:
 Volume dropped 39.38% MoM, and value fell 31.88%, but the average price rose 12.36% to 702.75 USD/ton.
o January–November 2024:
 Total imports reached 16.16 million tons, worth 11.5 billion USD, reflecting a 32.93% increase in volume and a 20.31% increase in value YoY.
 Average import price: 711.77 USD/ton, down 9.5% YoY.
o Key import sources:
 China: Dominated with 11.04 million tons (68.29% of total imports), valued at 6.92 billion USD (average price 627.44 USD/ton).
 Japan: Supplied 1.9 million tons, valued at 1.33 billion USD, at 696.11 USD/ton.
 Indonesia: Delivered 746,830 tons, valued at 1.15 billion USD, at 1,539 USD/ton.
5. Challenges and Opportunities
• Challenges:
o High production costs due to rising raw material prices and energy costs.
o Import competition from cheaper foreign steel, particularly from China.
o Macroeconomic pressures such as high interest rates and supply chain disruptions.
• Opportunities:
o Strong demand from public infrastructure projects and urban development.
o Focus on technology improvements and product quality enhancement by domestic producers to compete with imports.
o Continued government support through protective policies and import tariffs.
Conclusion
The Vietnamese steel market in 2024 demonstrated resilience amid fluctuating global and domestic conditions. Infrastructure projects and public investment remained key drivers, while producers navigated challenges through innovation and cost optimization. Looking forward, maintaining a competitive edge against imports and addressing macroeconomic challenges will be critical for sustained growth.
6.Forecast
In 2025, the price of construction steel is expected to experience a slight increase. The high demand for construction and the development of large projects are the main factors driving the price up. According to the Vietnam Steel Association (VSA), it is forecasted that steel production in Vietnam will increase by 10% in 2024 and 8% in 2025, as the demand for steel from domestic industries recovers. This is partly due to the acceleration of public investment disbursement in the transportation infrastructure sector.
T.Huong
Source: Vitic
 

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