Vietnamese Steel Expand Its Export Market

28 Agustus 2020

Steel production at the Southern Steel Company Limited (photo : SGGP)

Vietnam steel exports more than double on strong Chinese demand

Vietnamese steel exports more than doubled in June to 882,019 tonnes from 428,361 tonnes in May and remained high in July at 885,366 tonnes, data from Vietnam’s customs showed this month.

China was the key destination for Vietnamese steel in both months, importing 489,685 tonnes in June and 401,930 tonnes in July.

High prices in domestic Chinese markets, an open arbitrage window, the short shipping time compared with other origins such as India and the Middle East, as well as the free trade agreement (FTA) between the Association of South East Asian Nations (Asean) and China meant China was a natural customer for Vietnamese steel. (Metal Bulletin)

Vietnamese steel tries its strength in European market

Vietnam's steel products are facing the risk that the export market will be narrowed due to several trade-remedy investigations and the imposition of anti-dumping duties. Facing that fact, many steel producers are making efforts to improve product quality to change the direction and promote exports to the European market.

According to the latest report of the Vietnam Steel Association (VSA), from the beginning of the year until now, steel production has reached more than 11.6 million tons, down 8.1 percent over the same period last year. The sales of steel enterprises have also encountered many difficulties as the market was affected by the Covid-19 pandemic. Accordingly, steel sales only reached 10.4 million tons, down 10.7 percent over the same period last year. In which, steel exports exceeded 1.8 million tons, down 24.6 percent over the same period. In June alone, Vietnam exported more than 300,000 tons of steel to foreign markets, with a turnover of nearly US$250 million, up 14.5 percent over the previous month but down 21.9 percent over the same period last year. This is a rather pessimistic figure for enterprises in the steel industry.

In the structure of export markets, VSA said that currently, steel exports to the Southeast Asia market accounts for 54.75 percent of total export volume and 57.8 percent of export turnover. Meanwhile, steel exports to the European market merely reach 4.15 percent. With such the above figures, it can be seen that the European market accounts for a tiny proportion of the steel exports of Vietnam. Up to now, the EU- Vietnam Free Trade Agreement (EVFTA) has been approved by both sides with terms benefitting Vietnam's export industries, including the steel industry, when enjoying an import tariff of zero percent following the commitment of the EVFTA.

Mr. Doan Danh Tuan, Chairman cum CEO of Toan Thang Steel Trading Company Limited shared that the company has never had any export activities to the EU market. However, with the advantages brought by the EVFTA, the company has had strategies to enter this market in the coming time.

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