According to the General Department of Customs, in the first two months of 2024, the amount of steel imported into Vietnam was 2.65 million tons, nearly double that of the same period last year. Of which, steel imported from China accounted for 1.8 million tons, 3 times higher in volume and 2.4 times higher in value.

Hot rolled steel dominates imported steel products in the first 2 months of 2024

Regarding hot-rolled steel (HRC) products alone, in the first two months of 2024, Vietnam imported 1.89 million tons, with an import value of over 1 billion USD. Of which, steel from China was 1.4 million tons, accounting for 74.2% of the total HRC imported in the two months.

Previously, in 2023, Vietnam imported 13.8 million tons of steel of all kinds (including temporarily imported goods for re-export, imported into export processing zones, etc.), an increase of 3.2% compared to 2022 and 11% compared to 2021. Steel import turnover was 10.4 billion USD.

Most steel products imported to Vietnam increased compared to 2022 and 2021. Of which, the most imported steel product is hot-rolled steel (HRC) with 10 million tons, up 2.84% compared to 2022 (including hot-rolled steel in coils and sheets), accounting for 73% of the total steel imported to Vietnam. Next is construction steel imported nearly 1.3 million tons, up 7.8% compared to 2022 and up 33% compared to 2021. Galvanized steel of all kinds imported 1.16 million tons, up 20.68%.

Developments in the volume and price of imported steel into Vietnam in the months of 2023 and 2024

Source: Calculated from preliminary statistics of the General Department of Customs

According to the Vietnam Steel Association's report, in 2023, steel imported from China accounted for nearly 8.3 million tons, equivalent to more than 62% of total steel imports. Next was Japan at 14.3%, South Korea at 8.3%, etc.

Regarding hot-rolled steel alone, 70% of imports are from China, putting great pressure on domestic production. The current sharp increase in Chinese steel imports is due to the fact that most steel products imported into Vietnam have an import tax of 0%.

The selling prices of steel from China and other countries supplying Vietnam have decreased significantly. China's HRC decreased from 618 USD/ton in the first quarter of 2023 to 557 USD/ton in the fourth quarter. China's HRC selling prices currently fluctuate between 520 - 560 USD/ton, depending on the type. This causes many difficulties for domestic steel production enterprises.

Regarding domestic steel production capacity, according to statistics from the Vietnam Steel Association, the total production capacity of domestic steel enterprises currently reaches about 23 million tons of crude steel (square billets, flat billets). The production capacity of finished steel products including construction steel, hot-rolled and cold-rolled coils, galvanized steel, and steel pipes reaches about 38.6 million tons/year. In fact, in 2023, enterprises under the Steel Association produced 27.7 million tons. Consumption reached 26.3 million tons, of which 8 million tons were exported.

Domestic production capacity basically meets domestic demand. Moreover, Vietnamese steel has met international standards and is exported to many countries around the world.

However, the increasing import of cheap steel threatens to upset the trade balance.