Posted on 01 Jun 2009
Nguyen Tien Nghi, association vice chair, said that the consumption of steel products started to accelerate early last month thanks mostly to house construction in the country.
"The monthly output of steel products and ingots of domestic enterprises has increased 30 percent since last month to meet higher demand, and that's a satisfactory sign for the industry," Nghi told the Daily on Tuesday.
Nghi said that the country's steel industry is expected to repeat last year's consumption level of 3.8 million tonnes as targeted.
According to Nghi, thanks to appropriate tax rate policies on steel imports and exports, May's steel product imports were measurably reduced.
Meanwhile, many domestic steel producers are averaging 10,000 tonnes of construction steel product exports to
The factory price of rolled steel is stable at 10.6 million dong a tonne, while imported steel ingots are $420 a tonne. Many steel producers said that these prices could be profitable.
Do Van Thanh, general director of Dinh Vu Steel Company, a large steel ingot producer in the northern city of
"Due to the increase in monthly output to 15,000 tonnes of steel ingots, the company is maintaining jobs for 750 workers," Thanh said.
Nghi commented that the production capacity of domestic steel producers is nearly double domestic steel consumption. The country's steel demand is 3.8 million tonnes a year while the total production capacity is 7 million tonnes a year.
Production capacity is expected to increase to 60 million tonnes a year by 2020, while the maximum annual demand for steel products in years to come is expected to be 20 million tonnes.
According to the association, the Ministry of Natural Resources and Environment is conducting an overall check-up of the iron ore supply for licensed steel projects.
In March, the government directed relevant authorities to stop licensing steel projects that use outdated technology and lack material sources for long-term production.
