Steel sector projects 12 per cent growth

Steel sector projects 12 per cent growth

The domestic steel sector is expected to grow at just around 10 to 12 per cent this year, as consumption from July to December would not be high.

Viet Nam Steel Association (VSA) said the three months left in the second half of the year would fall in the rainy season. This is the reason why the industry's growth would be the same as the first half of the year with expected consumption of 1.31 million tonnes, increasing by 13 per cent.

Statistics from the association showed that steel consumption in June was still low at 376,000 tonnes, reducing 10.5 per cent over the previous month.

This was the second consecutive month the sector saw decreasing steel consumption after a sharp increase in March and April with an average amount of more than 550,000 tonnes each month.

The report of Vietcombank's Securities Company (VCBS) on prospects in the second half of the year, also said output of building steel in the six-month period would rise 12.7 per cent to 1.36 million tonnes in comparison with the first half of the year.

However, VCBS said policies to tighten truck loading capacity from the beginning of April, and the rise in prices after the increase in transport costs by 1.5 to 1.7 times, would also reduce steel consumption.

The Ministry of Industry and Trade added that steel prices have risen by VND100,000 to 150,000 per tonne because of the recent petrol hike.

Selling price of almost steel products rose 5 to 10 per cent. Prices of building steel have been at VND15.6 to 15.65 million (US$739.3-741.7) per tonne.

In addition, the joint decree No 44/2013/TTLT-BCT-BKHCN tightening quality of domestically produced and imported steel also caused difficulties in consumption.

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