Steel sales to be ‘modest' in Q4
Steel sales to be ‘modest' in Q4
Although construction historically picks up in the fourth quarter, steel sales are expected to see only a slight increase, according to the Viet Nam Steel Association (VSA).
"In the fourth quarter, we could see about 400,000 tonnes of sales each month, which is very modest compared to previous years," said Nguyen Tien Nghi, the VSA's vice chairman. "But we're not even sure if we can reach that figure."
Nghi said that tough economic conditions were the main reason behind the sluggish sales growth.
"Real estate projects are still not completely back on track, so sales will continue to be affected," he said.
But growth could pick up for two reasons.
Some investors were fast-tracking their construction schedules, and the government might loosen financial policies in the fourth quarter, Nghi said.
Last month, VSA members produced 375,000 tonnes of steel, with sales increasing modestly to 356,000 tonnes.
For the first nine months of the year, production was 3.36 million tonnes, while sales totalled 3.3 million tonnes, a drop of 10 per cent compared to the same period last year.
As of the last day of September, the volume of inventory for the industry totalled 328,000 tonnes.
Domestic sales have slumped because of the competitiveness of imported products, mostly from China.
While domestic production can meet demand, many companies still import steel from other countries because of low import tariffs.
In addition, import procedures are simple, leaving the domestic steel industry at a disadvantage and less competitive than companies from other countries.
As a result, the Ministry of Finance has drawn up a draft that proposes an increase of import tax on some steel products.
Under the draft, the import tax on cold-rolled stainless steel would be raised from 5 to 7 per cent.
This year, Viet Nam's total cold-rolled stainless steel production output would reach 300,000 tonnes, while demand would be lower than 250,000 tonnes, according to VSA.
vietnamnews
