Vietnam steel needs state support or face closure

The Vietnam Steel Association (VSA) has warned that local steel businesses may  face bankruptcy if the State does not intervene

The announcement came as VSA members reported an overall 2.08% on 2012  production levels, making only 2.26Mt of construction steel during  the first half of the year. As of June 30, nearly 327kt of this was still to be sold.

The association blamed the industry's dire state on the real estate market's extended  freeze and the dominance of imported Chinese steel in Vietnam.

Large quantities of Chinese steel are being imported as construction steel to dodge  taxes and undercut domestic producers to the point of bankruptcy, VSA said.

Competition from imported foreign steel has pushed prices down VND300–500  (US$0.014-0.024) per kilo, whilst local producers are also struggling with anti- dumping taxes imposed by several export markets.

By the end of May, more than 5.Mt of finished steel, worth $3.5bn had  been imported to Vietnam, while the total export volume reached just 1.2Mt, with turnover slightly over $1bn, according to the General Department  of Customs.

Source: www.bizhub.vn, 27 July 2013