According to data from the National Bureau of Statistics of China, due to the difficult real estate market, many other domestic economic sectors have recovered slowly, leading to a steel oversupply.
Experts predict that in 2024, China could export 90-95 million tons of steel at most, the highest in 7 years. Even in the context of a weak global economic recovery, China will still export 75-80 million tons of steel this year.
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| China just reported its highest steel export figures in eight years. |
“ When domestic demand is not high, China will switch steel to foreign infrastructure projects, mainly in developing markets ,” experts said.
China, the world's largest steel producer, is increasing its exports as domestic consumption weakens, raising concerns about a global supply glut.
In the domestic steel market, according to data from the General Department of Customs, in the first two months of 2024, the amount of iron and steel imported into Vietnam was nearly 2.65 million tons, nearly double that of the same period last year. Of which, steel imported from China accounted for over 68% of the country's total imports, reaching 1.8 million tons, 3 times higher in volume and 2.4 times higher in value.
Particularly for hot rolled coil steel, imports in the first two months of the year reached 1.89 million tons, worth over 1 billion USD. Of which, steel from China was 1.4 million tons, accounting for 74.2% of the total HRC (hot rolled steel products) imported in the two months.
The current situation of sharp increase in Chinese steel imports is due to the fact that most steel products imported into Vietnam have an import tax of 0%.
The selling price of steel from China and other countries supplying Vietnam has decreased significantly. China's HRC decreased from 618 USD/ton in the first quarter of 2023 to 557 USD/ton in the fourth quarter of 2023. China's HRC selling price currently fluctuates between 520 - 560 USD/ton, depending on the type. This causes many difficulties for domestic steel production enterprises.
Normally, many years ago, the average import volume from China only accounted for about 50%, and at times even dropped to more than 40% of the total steel imported into Vietnam. With the recent strong import trend, some steel industry experts believe that China's slowing economic growth and the cooling real estate market have caused weak demand for steel.
According to the Vietnam Steel Association, in 2023, steel imported from China accounted for nearly 8.3 million tons, equivalent to more than 62% of total steel imports. Next was Japan at 14.3%, South Korea at 8.3%, etc. For hot-rolled steel alone, 70% of imports came from China.
Businesses said that the selling prices of steel from China and other countries supplying Vietnam have decreased significantly. Chinese hot-rolled coil steel decreased from 618 USD/ton in the first quarter of 2023 to 557 USD/ton in the fourth quarter of 2023.
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