Demand for construction steel in 2022 may increase by 8.5% thanks to the push of the public investment package

According to Rong Viet Securities Joint Stock Company (VDSC), domestic construction steel consumption may grow rapidly in 2022 thanks to the push of the public investment package and the reopening of the economy.

Specifically, public investment in infrastructure projects will boost domestic steel demand, especially construction steel.

According to the medium-term public investment plan for the 2021-2025 period approved by the National Assembly, the total planned public investment capital reached VND 2.8 million billion, an increase of 43.5% compared to the plan for the 2016-2020 period.

Transport projects accounted for the largest proportion when total expenditure on transport projects reached more than 570 trillion VND (US$24.8 billion), equivalent to 42.3% of the central budget. Therefore, construction steel manufacturers can benefit from this trend.

Besides, civil construction activity is likely to recover in 2022, boosting steel demand.

With a higher vaccination rate, VDSC believes that construction activities will be more favorable, domestic construction steel demand in 2022 is expected to increase by 8.5% compared to 2021.

On the other hand, construction steel exports in 2022 may level off after importing countries increase vaccination rates and post-pandemic recovery in production.

Previously, in the first 11 months of 2021, construction steel exports had a positive growth, up 55% over the same period thanks to stable supply and competitive production costs. The share of construction steel exports also increased to 18.2% from 12.5% in 11 months of 2020.