Expectations for a sustainable recovery in the steel industry.

Sales of finished steel products reached over 2.4 million tons, an increase of 4.2% compared to June 2024. Of this, exports of finished steel products in July 2024 reached over 681,000 tons, an increase of 2.84% compared to the previous month but a decrease of 3.1% compared to the same period in 2023. Exports of construction steel, cold-rolled steel, and galvanized steel sheets increased compared to June 2024. Meanwhile, hot-rolled steel (HRC) decreased by 42.1% and steel pipes decreased by 5.8%.

Overall, in the first seven months of 2024, crude steel production reached over 12.8 million tons, an increase of 21% compared to the same period in 2023. Domestic consumption and exports of crude steel reached 12.4 million tons, an increase of 17% compared to the same period in 2023. Of this, exports reached 1.58 million tons, an increase of 45% compared to the same period in 2023.

Finished steel production reached 16.9 million tons, an increase of 9.4%. Of this, the production of galvanized and color-coated steel sheets saw the highest growth at 29.2%, followed by construction steel at 14.6% and HRC at 2.9%. Cold-rolled steel coil and steel pipe production both recorded negative growth rates of 14.9% and 1.1%, respectively.

The Ministry of Industry and Trade forecasts that finished steel production in 2024 could reach 30 million tons, a 7% increase compared to 2023. However, the Vietnam Steel Association (VSA) believes that this recovery is not yet certain.

Sales of finished steel products reached 16.7 million tons, an increase of 14.3% compared to the first seven months of 2023. Exports of finished steel products in the first seven months of 2024 reached 4.8 million tons, a growth of 6.8% compared to the same period in 2023. Cold-rolled coil (CRC) saw the highest growth at 40.6%, followed by galvanized and color-coated steel sheets, and construction steel. However, exports of steel pipes decreased by 1.2% and HRC decreased slightly by 0.8% compared to the same period in 2023.

Regarding imports, in the first six months of 2024, Vietnam imported approximately 8.2 million tons of finished steel products of all types, valued at over $5.9 billion, an increase of 47.8% in volume and 25.1% in value compared to the same period in 2023.

During the same period, Vietnam exported nearly 6.5 million tons of steel, an increase of 20.5% compared to the same period last year. The export value reached US$4.7 billion, an increase of 12.2% compared to the same period in 2023.

Recovery is uncertain.

Many experts have also predicted that, with the recovery of the residential real estate sector and the increase in the number of newly licensed projects, domestic steel consumption is expected to recover in the second half of 2024. In addition, the amended and effective Land Law is expected to stimulate domestic steel demand.

In particular, the Ministry of Industry and Trade recently decided to investigate and apply anti-dumping measures against certain galvanized steel products imported from China and South Korea; and to investigate and apply anti-dumping measures against hot-rolled steel products originating from India and China…

If the investigation uncovers violations, imposing tariffs will help create a fairer competitive environment for the steel industry in the coming years, and will improve the recovery of domestic businesses' hot-rolled steel sheets and coils.

According to the Ministry of Industry and Trade's forecast, finished steel production in 2024 could reach 30 million tons, a 7% increase compared to 2023. However, the Vietnam Steel Association (VSA) believes that this recovery is uncertain because the oversupply of many domestic steel products, coupled with increased steel imports, will intensify price competition for domestic finished steel products. The volatile global market and rising international freight rates also pose significant risks for steel businesses.

To truly become a foundational and developing economic sector in the coming years, the Vietnam Steel Association (VSA) stated that the steel industry needs government assistance in matters related to trade defense against imported products, creating a fairer competitive environment. At the same time, businesses themselves must improve product quality, competitiveness, and self-defense capabilities against investigations by importing countries.

VSA believes that, with the positive socio-economic developments in July and the first seven months of 2024, many sectors achieved better results in July than the previous month and the first seven months were better than the same period in 2023, and industrial production maintained its growth trend. Laws related to the real estate market, land law, etc., coming into effect could create momentum for a positive recovery in the steel market in the final months of 2024.

Thu An