Cheap Chinese steel is creating difficulties for local steel producers in many countries, including Vietnam. Vietnam's steel imports from China increased from about 5 million tons in 2021 to 8.3 million tons in 2023 and 7.2 million tons in the first eight months of 2024. These imports account for about 70% of the country's total steel imports.
The cost of imports has also decreased, from an average of 973 USD a ton of steel in 2022 to 682 USD last year. But this has resulted in antidumping investigations around the world, indirectly affecting Vietnam.
Vietnamese steel producers have been forced to cut their prices to stay competitive. In the first eight months of 2023, the steel export price decreased to USD 729. At the same time, Vietnam's steel imports were under threat from anti-dumping investigations launched on products from China, South Korea and India. Hoa Phat Steel in particular was one of the affected companies, with its market share falling from 45% in 2021 to 30% in 2023.
Vietnam's antidumping investigations are being met with strong protests from local buyers who are taking advantage of cheaper imports. Antidumping tariffs may also have a negative impact on the real estate sector by increasing construction costs.
Moreover, the oversupply problem is expected to worse. Vietnam's steel production is expected to increase by 7% this year. Thua Thien-Hue province is reportedly looking for investors for a new steel mill that could produce 3 million tons of steel annually.
As a result, the future of Vietnam's steel industry will depend on the outcome of trade investigations into steel imports from China.
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