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Steel output may be almost double demand
Steel producers are expected to produce about seven million tons this year, outpacing the demand of 3.8 million tons, according to Pham Chi Cuong, Chairman of the Vietnam Steel Association.
“If producers don’t control output, they will be faced with high stockpiles again this year,” Cuong said Wednesday in a telephone interview from Hanoi.
“They shouldn’t operate their mills at full capacity,” Cuong said.
The worst global recession since World War II has hurt demand for steel from manufactures and builders, prompting mills in China, the biggest producer, and elsewhere to cut prices. Steel demand in Vietnam has also fallen, leading to higher stockpiles.
“Consumption started to recover in April as steel demand rose again as the government’s stimulus package encouraged construction projects,” Cuong said. Domestic consumption rose 1.2 percent in the first five months from the same period last year to 1.5 million metric tons, he said.
The nation is subsidizing loans and increasing spending to bolster the economy.
thanhnien, bloomberg
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