Posted on 23 Sep 2009
Pham Chi Cuong, chair of Vietnam Steel Association once again warned that the domestic steel industry would suffer the most due to the overwhelming investment in steel industry.
In Ba Ria-Vung Tau province only, the total capacity of steel billet production and processing was posted at over 2.6 million tonnes per year for the current steel processors. Meanwhile, the domestic and foreign investors are carrying out a series of steel projects in the local area with total designed capacity of more than 5 million tonnes per year.
In which, the most noticeable project was the steel mill with designed capacity of 2 million tonnes per year to be conducted by Vietnam Steel Corp (VNS). The other project was of
In the latest working session with ministry of industry and trade, Vietnam Steel Corp and Vietnam Steel Association, Cuong affirmed that up to the end of 2009, the country's steel production capacity will be added by 2.2 million tonnes, increasing to over 7 million tonnes of construction steel per year.
In comparison with the current consumption power of construction steel of about 4 million tonnes, there's high risk of steel redundancy. However, many investors still concentrate on steel production projects.
It is predicted that Vietnam Steel Corp may reach total export turnover from steel products of $55 million in 2009. However, in its largest export market of
Together with the overwhelming steel production capacity,
Especially, when supplies exceed demands and there is much difficulty in steel export, the pressure of harsh competition in steel industry will burden the domestic steel producers.
Vietnam Steel Association (VSA) has asked the government to suspend the construction process of the steel mills that don't have sufficient raw materials to operate in long-term period.
In addition, the government must check the general development plan in steel production sector for sustainable development in domestic steel industry.
