Posted on 07 Apr 2008
"We are confident that prices will stabilise. Our
members have already committed to levelling prices this month," Cuong told
Viet Nam News.
Cuong was commenting after being asked about the current
steel price on the free market, now at VND17 million per tonne, an increase of
around VND300,000 per tonne over late last month. The price increased one week
after the Viet Nam Steel Association (VSA) announced the price would not
increase in March and would stabilise in April.
"It’s true! VND17 million is the price on the free
market. But the price of steel sold at our member companies in the capital city
of
However, retailers on the free market, he added, had begun
to reduce prices, and fewer and fewer retailers were still selling steel at
VND17 million per tonne.
"I hope steel prices over the next two months will be
more stable since it is the rainy season," Cuong said.
Recently, the domestic steel market has been affected by the
rising world market costs of steel.
Since the beginning of this month, the price of steel ore
has increased 65 per cent.
"We are indirectly affected by the rising price
although we do not directly import steel ore. However, other countries have to
import steel ore to produce steel ingots, so we are affected," Cuong said.
Not only has the rising price of steel ore led to the
increasing price of imported ingots, but so has the rising cost of coal. Last
week, the price of pig-iron in
Pig-iron on other markets like
Many people worry that high prices will lead to reduced
consumption, but VSA says this is not the case.
According to a report from VSA, steel consumption in
February and March was 296,00 tonnes and 350,00 tonnes respectively, higher
than the average consumption last year.
VSA estimates the domestic steel consumption this year will
increase by 20 per cent over last year due to strong foreign investment and the
number of State projects, such as Son La Hydro power Plant and Dung Quat Oil
Refinery, are under construction.
The country’s present demand for pig-iron is 4.6 million
tonnes. However, domestic companies can supply only 2 million tonnes.
VSA said steel ingots produced in
