The competitiveness of Vietnamese steel is still low because it depends on imported materials

Steel production also depends on imported raw materials

The Ministry of Industry and Trade said that by 2021, the billet production capacity is 27 million tons/year; in which hot rolled coil (HRC) is 7-8 million tons/year, according to VNA.

In addition to a number of new factories with large capacity, such as: Hoa Phat Dung Quat Iron and Steel Complex, Hung Nghiep Formosa Iron and Steel Complex, Nghi Son Steel. The remaining steel billet factories mainly have small capacity and outdated equipment.

Steel production capacity is still limited. Currently, mainly products cannot supply enough steel demand for the whole economy; especially alloy steel, Vietnam has not yet produced special steels.

The competitiveness of Vietnam's steel industry is still quite low when most of the input materials for steel production must be imported. Besides, there are still factories with small capacity, outdated equipment, energy consumption and environmental risks.

“Vietnam's steel industry basically depends on imported foreign raw materials such as iron ore, steel scrap, coking coal, graphite electrode... so when the price of input materials fluctuates, it will affect the domestic finished steel price must also adjust according to the world market", emphasized the Ministry of Industry and Trade.

It is expected that in 2022, Vietnam has to import many types of materials to produce steel such as iron ore for blast furnaces about more than 18 million tons, scrap steel about 6-6.5 million tons for electric furnaces, smelting coal. cup about 6.5 million tons and graphite electrode about 10,000 tons…

With the forecast that the price of iron ore, scrap steel, raw material ore and coking coal... will remain high, which will directly affect steel producers and the domestic steel market.

Recognizing the recent development process, the Ministry of Industry and Trade said that in the period 2016-2021, the steel industry has had a rapid but unbalanced development between upstream and downstream development. The following steel products such as galvanized steel sheet, steel pipe have good growth in production and export value.

Meanwhile, all kinds of alloy steel, especially HRC - an essential input material for many industries such as cold-rolled steel (CRC) production, galvanized steel, steel pipes, shipbuilding, mechanical engineering are in high demand. demand is large, but the domestic production capacity has not yet met the demand, so it continues to have to import in large quantities.

In the long term, to ensure the demand for HRC and other high-quality alloy and steel in the country, it is necessary to continue to attract and invest in a number of large steel production complexes to serve domestic demand, reduce gradually dependent on imported steel.

Autonomy in domestic steel production is an indispensable requirement of self-reliance in raw materials for production and consumption of the people, as well as the process of urbanization and modernization of the national infrastructure. ", the Ministry of Industry and Trade confirmed.

Steel processing and manufacturing will become the spearhead of the industry

In order to improve the competitiveness of the steel industry, the Ministry of Industry and Trade proposed to develop a "Strategy to develop Vietnam's steel industry to 2030, with a vision to 2050".

According to preliminary forecasts, the total market demand of Vietnam's manufacturing industries in the period to 2030 may reach 310 billion USD.

The Minister of Industry and Trade said that the steel industry plays a particularly important role in the process of developing the country towards industrialization and modernization, but there is no specific policy.

After the steel industry master plan was abolished according to the provisions of the Planning Law in 2017 and the price control was also removed from the list of controlled goods according to the provisions of the Price Law 2012, the State did not have the tools, so it was difficult to ensure the state management of the steel industry, cannot manage production capacity, balance supply - demand for domestic steel industry products to supply raw materials.

The Ministry of Industry and Trade has set a number of orientations to strongly develop the metallurgical and material industries, especially steel processing and manufacturing.

Firstly, with the HRC category: in the coming period, it is necessary to develop and invest in more large production projects. This is a type of steel with a large proportion in the processing and manufacturing industry.

Second, with alloy steel and especially for the mechanical industry, Vietnam needs to build large-scale metallurgical complexes; which focuses on manufacturing processed and fabricated steels with high technological level with large market capacity to initially master the technology of manufacturing basic processed steels.

In addition, the Ministry of Industry and Trade also mentioned that the state has preferential policies on land, infrastructure, science and technology and human resource training to encourage and promote steel projects to develop. to form and strongly develop the metallurgical industry.

Vietnambiz