Steel prices 'reverse' in 2022?

Therefore, steel prices in 2022 always receive a lot of attention. Some experts believe that the steel price level will continue to stay at a high level, at least in the first half of 2022.

As of early December 2021, the price of construction steel, although slightly decreased by 200-300 VND/kg, still stood at 15,900-16,000 VND/kg. Many enterprises in the industry such as Hoa Phat, Hoa Sen, and Nam Kim had a speedy year thanks to rising selling prices and boosting export channels.

Some experts believe that the steel price level will continue to stay at a high level, at least in the first half of 2022. The reason is that many real estate projects in progress have been postponed due to the impact. social distancing, but from the beginning of next year, these projects will be quickly deployed to meet the progress requirements committed with customers.

In addition, 2022 will see many large-scale public investment projects begin construction, notably the North-South expressways, Long Thanh international airport and ring roads... Steel consumption recovered strongly in the period of adaptation to the Covid-19 pandemic. In general, the positive signals from public investment momentum and the recovery of the real estate industry across the country will help the steel industry continue to be vibrant.

On the other hand, the increase in input material prices of steel mills (with the increasing trend of oil prices) makes it difficult for finished steel production fees to cool down. For example, the price of coke from the beginning of 2021 has continuously increased due to the sharp increase in energy demand from countries. In the long-term future, experts believe that coal prices will gradually cool down, but will still be at a higher level than before.

Talking about this issue, Mr. Narendran, CEO of Tata Steel Group, said that by the end of 2021, the average price of hot rolled coil (HRC) will be around $400-450/ton, but in the long term, the price of this HRC steel may reach a higher level because the supply from China slows down.

"I expect the price of steel in the long-term to rise to the threshold of $ 600 / ton, of course the price can be more volatile and volatile than we have seen in the past," Mr. Narendran emphasized.

Besides, Vietnamese steel enterprises are trying to take advantage of opportunities from export channels.

According to data from the Vietnam Steel Association (VSA), iron and steel exports have increased since the first months of 2021, due to trade agreements such as CP-TPP and the Vietnam-EU FTA that will help Vietnamese steel have a competitive advantage. painting.

Major domestic manufacturers such as Hoa Phat, Ton Hoa Sen or Nam Kim all achieved impressive export figures. Vietnam's iron and steel products are mainly exported to ASEAN, China, EU, and US markets.

It is forecasted that in the second half of 2022, the steel price level may be more stable when the supply disruption is gradually resolved, helping to lower the cost of transporting raw materials and steel products.

At the same time, steel mills will increase output to solve the problem of product shortage.

“Vietnam's construction steel price is likely to drop to VND 14.3 - 13.6 million/ton in 2022-2023, down 8-5% respectively compared to 2021.

Besides, BVSC Securities Company forecasts the price of construction steel will drop to VND 14.5 million/ton in 2022, while the price of HRC is forecasted to drop to VND 17 million/ton, down 11.5% over the same period last year. 2022”, VNDirect Securities Company forecast.

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