news Published on January 28, 2019

Steel producers urged to enhance product quality to compete

VNS/VOV

Enhancing product quality and optimizing production cost would help domestic steel producers compete with the cheap products imported from China, Nguyen Van Sua deputy president of the Vietnam Steel Association, said.

Sua said the domestic steel industry still had the opportunity to grow in 2019 as the Vietnamese Government had set a high growth target of 6.8-7% this year.

The Government was also pushing to speed up the disbursement of public investment funds, which would push up demand for steel products used in construction projects.

Sua expects the industry to grow by ten percent in 2019.

According to the Ministry of Industry and Trade, the steel industry was estimated to increase by 20% in 2018.

Le Phuoc Vu, chairman of steelmaker Hoa Sen Group, said the industry would face difficulties in 2019.

In the domestic market, there was more supply than demand. The inflow of cheap and poor-quality products from China was also contributing to the fierce competition.

Customs statistics showed that much of Vietnam’s imported steel and iron products came from China with a volume of 6.27 million tonnes, accounting for 46% of the country’s total steel and iron import.

Vu added domestic steel producers also faced a number of trade defence defenses over the past year, which was weighing down exports.

Vnsteel’s director Nguyen Dinh Phuc said the market would see fierce competition in prices of steel products this year.

Phuc anticipates the Government will introduce policies to tighten the import of steel products which Vietnam is able to manufacture domestically. It should also create measures to prevent the influx of cheap and low-quality steel products from China.

Solutions to stimulate demand and develop markets for steel products should be introduces, including speeding up disbursement of public investment, creating farouvable conditions for steel producers to access credit and boosting the development of the real estate market, Phuc said.

Le Viet, director of Southern Steel Sheet Co. Ltd, said it was important for steel producers to reduce production costs and enhance quality to be able to compete.

Deputy Minister of Industry and Trade Do Thang Hai urged domestic producers to keep a close watch on the market to monitor supply and demand and create appropriate production plans to avoid high inventory volumes.