Positive prognosis for steel sector in 2023

The steel industry will see improvement in 2023. Photo: Hoa Phat Steel

After a lengthy period of price stability, Hoa Phat Steel raised the price of CB240 coil product to $628 per tonne and D10 CB300 rebar to $640 per tonne in the last days of 2022. With the global rebound of iron and steel prices over the last month, construction steel costs in the domestic market are seeing significant changes after almost two months of stability.

Numerous analysts are bullish about the steel industry in 2023. According to VNDirect Securities Corporation, China's reopening will aid in the resumption of building operations and the expansion of infrastructure investment, thus supporting the recovery of steel demand. This is one of the most important factors boosting the increase in steel companies' export production in 2023.

According to the Mercantile Exchange of Vietnam (MXV), the January iron ore futures price quoted on the Singapore Exchange declined by just 0.01 per cent at the close of trade on January 3. The MXV-Metal Index hit 1,809 points, an increase of 0.06 per cent compared to the prior session. consequently, iron ore prices have surged by almost 36 per cent during the previous two months, mainly owing to investors' anticipation that demand would revive in China.

According to MXV, the construction phase of every industry needs a great deal of steel, and Vietnam's primary strength is the manufacturing and export of construction steel. This may be a favourable chance for the local steel industry's foreign trade activity to identify new prospective partners.

This enormous economy continues to import a substantial quantity of steel from Vietnam to China. After reopening, infrastructure building investment is deemed an essential responsibility, and Vietnam has the potential to enhance product quality to increase market share. Hoa Sen Group and Nam Kim Steel will potentially boost their export volumes due to the global industrial production recovery.

According to the Vietnam Steel Association, the major market for Vietnam's steel exports will continue to be ASEAN nations, which will account for 42 per cent of the export structure.

Although economic pressures stemming from slowing global growth may be a significant obstacle, the trend of international firms expanding their investment activities in this region will be a promising indicator for iron and steel steel consumption in industrial activities, which opens the door for Vietnam's iron and exports .

In addition to China's stimulus strategy for the real estate market, the reopening of the economy bolstered the rising trend of iron prices.

Positive indicators for the steel sector emerged at the start of 2023, such as the projected decline in coke prices from $420 per tonne in 2022 to $258 to $220 per tonne in 2023 and 2024, respectively. After coke operations resume regularly in coal mines, iron ore prices are also expected to fall over the long term, $110 per tonne in 2022 to $90-$70 per tonne 2023 and 2024.

Pressing issues trouble Hoa Phat Group The continuous decline of steel prices, along with the sharp increase in financial expenses under exchange rate pressure, is reducing the profit margins of Hoa Phat Group (HPG).

Zamil Steel upbeat on Vietnam market The leading steel structure supplier in the region, Zamil Steel Buildings Vietnam Co., Ltd. sees a bright outlook for the Vietnam market over the next five years.

Hoa Phat Dung Quat Steel JSC under tax inspection Quang Ngai Department of Taxation has issued a decision to inspect the tax payments of Hoa Phat Dung Quat Steel JSC.