On April 18, the Vietnam Steel Association (VSA) published a report on Vietnam’s steel market in March and the first quarter of 2022.
Accordingly, in March 2022, Vietnam’s finished steel production reached 3,338 million tons, up 29.16% compared to February 2022 and up 6.8% over the same period in 2021. Steel consumption of all kinds reached 3,123 million tons, up 21.3% over the previous month and 2.4% over the same period.
In the first quarter of 2022, compared to the same period in 2021, finished steel production reached 8,456 million tons, up 3.2%. Finished steel consumption reached 8,137 million tons, up 11.9%.
According to data from the General Department of Customs, in March 2022, Vietnam's exports of finished steel products reached 965.3 thousand tons, up 75.41% over February and down 22.8% over March 2021.
Steel export turnover in March 2022 reached 908.63 million USD, up 71.87% compared to February 2022 and 1.05% over the same period in 2021. Cambodia, Italy, Belgium, and Malaysia were Vietnam’s top steel exporting markets in March 2022.
In the first quarter of 2022, Vietnam exported about 2,275 million tons of steel, down 22.15% over the same period last year. Export value reached 2.3 billion USD, up 12.53% over the same period in 2021.
The main export markets of Vietnam in the first quarter of 2022 are the ASEAN, the EU, the United States, South Korea, and Hong Kong.
As for imports, in March 2022, imports of finished steel into Vietnam reached 1.1 million tons with a turnover of 1.139 billion USD, up 23% in volume and 22.36% in turnover compared to the previous year.
China, India, Japan, Korea, Indonesia, and Taiwan were Vietnam’s biggest steel suppliers in March 2022.
In the first quarter of 2022, imports of finished steel products of all kinds to Vietnam were about 3 million tons, with a turnover of more than 3.1 billion USD.
According to some experts' forecasts, in 2022, steel consumption in Vietnam will grow well based on increased disbursement of public investment, focus on infrastructure, and recovery of civil construction activities.
Specifically, the National Assembly has approved an economic recovery support package worth 350,000 billion VND, 113,850 billion of which is allocated for infrastructure development, focusing on projects such as the North-East Expressway, Long Thanh airport, large logistics ports, etc. These projects will result in an increasing iron and steel consumption demand.
In the recently released steel industry prospect report, Mirae Asset Securities forecasts that Vietnam's steel output in 2022 will reach 33.3 million tons, up 8%.
The outlook based on the real estate and construction sectors will recover, thereby boosting the output of the whole steel industry. However, the output will hardly have a sudden growth like in 2021 when most domestic steel companies have run at full capacity and no new big projects have been introduced.
Previously, in 2021, the industry's steel output reached 30.8 million tons, up 32.5% over the same period. In which, export output reached 7.5 million tons, up 66%, corresponding to a total export value of 12 billion USD, the highest in history. The galvanized sheet segment has the most impressive growth with the whole industry's output in 2021 reaching 6 million tons, up 52.5%, of which exports account for 45%, equivalent to 3.4 million tons, up 133%.
Mirae Asset believes that the export market will continue to expand in 2022 under the impact of the war between Russia and Ukraine. Export volume is forecasted to increase by 15% in 2022 to reach 8.7 million tons.
However, Vietnam’s steel industry is facing three main risks.
First is the risk of material price fluctuations. The steel and galvanized steel industry are at risk because raw material costs account for 65-75% of production costs.
Second is the risk of anti-dumping taxes on the export market. Vietnam’s steel industry currently exports a lot to countries such as China, the EU, the USA, etc. Therefore, there is still a risk that the tariff policy will change with the ongoing trade war between China and other countries.
Finally, the risk of export restrictions. In March 2022, the price of construction steel increased to 18.3 million VND/ton. If the construction materials price is high, some steel lines will be restricted from exporting. Construction steel billet is the product line that may face this risk first.
Source: The Ministry of Industry and Trade, vneconomy
Compiled by Vietnamcredit