Domestic steel consumption up in March

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VietNam News English - 30 month(s) ago 11 readings

Domestic steel consumption up in March

Domestic steel consumption increased sharply in March with a month-on-month rise of 34 per cent despite the ailing domestic real estate market.

Steel is stored by a retail agent in northern Bac Ninh Province. Steel consumption in March surged 34 per cent month-on-month despite the economic difficulties. — VNA/VNS Photo Phuong Thao
HA NOI — Domestic C consumption increased sharply in March with a month-on-month rise of 34 per cent despite the ailing domestic real estate market.

Nguyen Tien Nghi, vice chairman of the Viet Nam Steel Association, told the Cong Thuong (Industry and Trade) newspaper that thanks to increased consumption, steel makers were able to reduce their stockpiled products.

As of the end of last month, stockpiles produced by VSA members were estimated at 288,814 tonnes, much lower than the average figure usually set at around 400,000 tonnes.

This reflected a decrease of 100,000 tonnes or 30 per cent compared with the same period last year.

According to the VSA, during the first quarter of the year, members of the association produced and sold 1.1 million tonnes of steel products. In March alone, steel makers produced around of 467,172 tonnes of construction steel, a rise of 36 per cent in comparison with February.

Upped sales in March were seen as a positive factor which has helped decrease stockpiled steel products. Of this, a volume of 521,000 tonnes was sold last month, an increase of 59 per cent compared with the same period last year. The increase in domestic steel consumption was due to increasing input costs of steel ingot, causing traders to purchase steel in advance of the coming construction season to avoid an increase in prices.

During the first two months of the year, both steel consumption and production had faced many challenges, partially due to the slump in the property market, which in turn led to stagnation in the construction and construction materials industries.

The domestic market consumed just about 233,000 tonnes and 380,000 tonnes of steel in January and February this year, respectively.

During the first two months of the year, the country exported about 334,946 tonnes of steel products including pig iron, construction steel, laminating steel and pipes with a total revenue of nearly $300 million.

The market saw a slight increase in the prices of steel during March after experiencing a consecutive decline in the first two months of the year. At the moment, prices of steel products ranged from VND16.15 million (US$772.7) to VND17.14 million ($820) per tonne in the northern and southern provinces of Viet Nam, respectively.

However, Nghi said that because of the stagnant real estate market and a reduction in public investment under Government Resolution 11, the trend of increasing consumption of steel products might be temporary.

In the past months, due to such difficulties, many steel producers have been forced to minimise production, running at 50 per cent to 60 per cent of capacity. Several newly built steel production plants in Thai Nguyen, Da Nang and Thai Binh have not started operations yet. — VNS

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