Construction steel consumption in October increased by 44% year-on-year to 1.25 million tons. This consumption level is higher than in October 2021 - the peak period of the steel industry.
Construction steel consumption reaches highest level in nearly three years
Figures from the Vietnam Steel Association (VSA) show that finished steel products consumed nearly 2.74 million tons last month, up 9.4% from September and up 22.5% year-on-year. Growth came from construction steel, steel pipes, galvanized steel sheets and SPM. The improvement mainly came from the domestic market as exports continued to decline.
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| The steel market is expected to be more vibrant in the fourth quarter thanks to the acceleration of construction progress. Photo: Hoa Phat |
Of which, construction steel recorded more than 1.25 million tons sold, up nearly 34% and 44% respectively compared to the previous month and the same period in 2023. This is the highest consumption level since March 2022. Sales are exceeding the total amount of construction steel produced in the month by more than 185,000 tons.
In the first 10 months of the year, the market consumed more than 9.96 million tons of construction steel, about 11% higher than the same period in 2023. This shows that purchasing power has partly recovered.
Consumption improved despite the fact that construction steel prices increased five times in a row in October. For example, Hoa Phat's CB240 coil steel price is currently VND13.94 million per ton, an increase of VND510,000 after five adjustments. As for D10 CB300 rebar, the selling price is about VND14.14 million per ton, an increase of VND740,000 compared to mid-September.
The price increase was also applied by other companies such as Viet Y, Viet Duc, Viet Sing, Kyoei Vietnam, VJS... Thus, the price of construction steel is back to the mid-June level, before a sharp price decrease occurred throughout the following period.
A recent report by VPBank Securities (VPBankS) stated that the consumption output of most types of steel in the domestic market has grown mainly thanks to the demand from both the construction and industrial sectors remaining positive. This analysis group believes that construction steel prices have bottomed out thanks to low inventory levels, expectations of a slow recovery in the real estate market, and continued growth in steel consumption demand for the industrial and infrastructure sectors.
In addition, the domestic steel industry is also benefiting from increased protection measures that help reduce competitive pressure. At the end of October, the Ministry of Industry and Trade extended the anti-dumping measures by 5 years by imposing taxes on color-coated steel and color-coated steel from China and South Korea, thereby creating momentum for better steel consumption.
Creating growth momentum in 2025
Given the current situation, VSA forecasts that in the remaining months of 2024, the Government's policies to support reconstruction and recovery after the storm will impact steel demand. The fourth quarter is also a good time to deploy and accelerate construction projects. At the same time, the construction steel market is also expected to be more vibrant.
“In general, in 2024, production and sales of steel products may achieve growth compared to the same period in 2023,” VSA said.
VSA also forecasts that Vietnam's steel production could increase by 10% in 2024 and 8% in 2025, as domestic demand for steel recovers. This is partly due to the increased disbursement of public investment capital in the transport infrastructure sector.
Regarding this issue, Mr. Pham Cong Thao, Deputy General Director of Vietnam Steel Corporation, said that according to the forecast of the World Steel Association, the demand for finished steel in 2024 will grow by 1.9% compared to 2023, of which the steel consumption demand of the European region will grow by 5.7% (this is also one of the largest steel export markets of Vietnam), and the ASEAN region will grow by 5.2%.
Some experts also believe that in the coming time, the Chinese real estate market may recover more clearly, leading to increased demand for both raw materials for steel production and finished steel products, leading to increased selling prices, affecting steel prices in the Vietnamese market. At that time, steel enterprises that have previously stocked low-priced raw materials will benefit, with better profit margins.
Of course, the increased demand for steel in Vietnam thanks to the "warming up" of the real estate market and the promotion of public investment projects is an important factor helping domestic steel prices recover.
In the immediate future, to "revive" the steel industry, according to economic experts, ministries, sectors and localities need to step up the implementation of public investment projects; remove difficulties for the real estate market, and lead and attract investment from the whole society to increase total demand for the steel industry.
At the same time, urgently and effectively implement regional and local planning and national sectoral planning, including 4 sectoral planning in the fields of energy and minerals, contributing to creating demand for consumption and exploitation and processing of minerals for steel production.
At the same time, it is necessary to promote trade promotion; build and protect the brand for Vietnam's steel industry; support steel production and trading enterprises to effectively exploit incentives from free trade agreements of which Vietnam is a member and international economic links to develop the market, expand and diversify steel export markets, as well as seek sources of raw materials with reasonable prices from abroad...
The Ministry of Industry and Trade has recently requested industry associations to promote their role as bridges and support steel production and trading enterprises; strengthen forecasting and provide information on iron and steel demand, especially construction steel for enterprises to balance steel demand for domestic and export markets; actively support steel enterprises to be proactive in production, balance domestic consumption and export of steel products to improve production and business efficiency.
Source: https://congthuong.vn/tieu-thu-thep-bat-tang-nganh-thep-ky-vong-tang-truong-nam-2025-361438.html
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