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Building pushes up steel prices
The price of domestic steel bounced by between VND50,000 and VND200,000 (US$2.8-11) per tonne in November after a drop in the preceding two months, according to the Viet Nam Steel Association (VSA).
Recent retail prices in the northern region ranged from VND11.6-12.7 million ($650-$719) per tonne. The price was a bit higher in the southern provinces, ranging between VND11.7-12.8 million ($657-$716) per tonne.
Accelerated construction activities nationwide have increased the demand for steel and driven up prices, according to the association.
Pig iron also up
Prices for raw materials have also gone up. A VSA report said the price for pig iron has recently increased by $10-20 per tonne on the world market. Petrol prices have also risen.
Experts predict that the domestic steel price could continue to increase in the near future as the world price rises. Currently, the volume of imported steel is limited because companies do not have US dollars. At the same time, reserves in storage are decreasing as construction projects kick off.
"Banks recently limited their US dollar loans to companies for steel imports even while the Government gave steel companies priority for projects," said Ngo Thanh Son, director of a steel importer in Ha Noi.
According to VSA, nearly 350,000 tonnes of steel were sold in November, a 10 percent increase over October.
Domestic steel companies have recently faced big challenges with the arrival of steel from ASEAN countries.
Although quality of steel from these countries is not significantly better than Vietnamese steel, the zero-tax rate makes it cheaper and more competitive.
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