Soaring China steel imports draw fire
Soaring China steel imports draw fire
Steelmakers are calling on the authorities to crack down on unlawful steel imports at a time when the domestic industry is already struggling with low demand and large stockpiles.
Viet Nam Steel Corporation's deputy director Vu Ba On said the country had recently seen a sudden increase in imported steel volumes, especially from China.
Figures from the Viet Nam Steel Association (VSA) show that imports from China in the first eight month of this year reached 137,500 tonnes, more than 5 times the quantity in the same period last year. According to the VSA, the entire quantity of steel entering from China last year totalled only 53,600 tonnes.
Much of this stell was with boron was added (about 0.0008 per cent), allowing it to be classified as "alloyed steel" and enjoy a lower import tax rate than construction steel. Construction is subject to an import duty of 15 per cent while "alloyed steel" faces a duty of only 10 per cent.
The Import Export Analysis and Classification Centre of General Department of Customs has also complained that it lacks the facilities to test for and verify the boron levels of steel entering the country.
Once imported, steel from China is sold at prices VND800,000-VND1 million (US$38-47) per tonne below the domestic price, creating unhealthy competition for domestic producers, said On, accusing China of pushing to increase exports of its own steel surpluses into Viet Nam and other ASEAN countries.
Meanwhile, domestic steel production and demand have both decreased by about 10 per cent from the level in the same period last year, while the volume of steel sold in the third quarter, at 300,000 tonnes per month, was well below the usual monthly average of around 420,000 tonnes, VSA vice president Nguyen Tien Nghi.
The total capacity of all steel mills nationwide was about 12 million tonnes per year while this year's demand was estimated at only 5 million tonnes, Nghi said.
In order to promote consumption, Nghi proposed that the value-added tax applied to steel be reduced from the current 10 per cent to 5 per cent, while additional measures be taken to curtail the low of imported product.
"If State administrative agencies do not take measures to deal with this issue and domestic enterprises get a more reasonable price, imported steel will continue to flood the domestic market," he said.
vietnamnews
