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Chinese steel producers plan to distribute their production capacity to other countries.
A potential trade war between China and the United States has prompted Chinese steel companies to shift some of their production to other markets, including Vietnam, according to the Nhip Cau Dau You magazine.
In Dong Nai province in Vietnam, after a year of being rejected, Yongjin Metal – a China-based steel company has returned its application for a cold-rolled stainless steel project with an annual capacity of 300,000 tons.
In addition, many other Chinese steel manufacturers have increasingly planned to enter Vietnam.
Meanwhile, Vietnam's steel imports from China continue to increase. The country imported nearly 2.74 million tonnes of steel worth $ 1.49 billion during the first two months of 2018, an increase of 62% from a year ago on the year. # 39; other. Of this figure, the volume from China was 1.53 million tonnes valued at US $ 786 million
In addition, steel consumption in Vietnam remains high . The increase in investments of major automotive groups such as Toyota, Mitsubishi, Thaco and VinFast also stimulates the demand for high quality steel.
In addition, Chinese steel companies in Vietnam may find their motivation in the growing presence of Chinese construction companies, including CSCEC, Tung Feng, who have for the most part won bids for many key projects in Vietnam over the past few years. last years. Companies have planned to move their production to Vietnam for years, said Max Brown, director of Dezan Shira's Business Intelligence at ASEAN. Yet the threat of the trade war is pushing them further, he added.
Nonetheless, the displacement of Chinese steel may pose new risks to Vietnamese steel mills, which are still protected under the umbrella of the "safeguard tariffs" that Vietnam has imposed on imports of oil. steel since 2016.
The Vietnam Steel Association (VSA) quickly reacted to the new movement of Chinese companies. The badociation asked the government not to issue new investment licenses for projects that would worsen overcapacity.
"We accept with the proposal of the domestic producers of stainless steel not to license the Yongjin Metal Project to avoid overcapacity in domestic supply," the VSA said.
Side Effects
In addition, Vietnam can confront the side effects of China's effort to sell its steel to other countries under the guise of "Made in Vietnam steel ". On June 12, some US-based steel producers filed an anti-dumping and anti-subsidy investigation at the US Department of Commerce for corrosion-resistant carbon steel imported from Vietnam because of suspicion of tax evasion. Korea and cold-rolled steel imported from Viet Nam, suspected of tax evasion from Korea.
The ministry will decide whether or not to open an investigation within 45 days of receipt of the application (sc heduled July 27). If the DOC decided to impose safeguard duties, the Vietnamese steel industry could suffer a loss of sales sufficient for 11% of its total exports in 2017.
As a result, some Vietnamese companies are expected to cease trading. import hot rolled coil from China to avoid DOC eyes.
The Vietnam steel industry is expected to grow 20-22% by 2018, according to the VSA. The production of hot rolled steel with 154% is the strongest, followed by welded steel tubes (15%), colored galvanized steel (12%), l & # 39; construction steel (10%) and cold rolled steel (5%).
Hanoitimes
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