The reason given by the mills is that the price of steel billets and raw materials both increased, causing product prices to increase accordingly, bringing the price of this product into a new upward trend after a sharp decline in the last months of the year.
Technical staff of Thai Nguyen Iron and Steel Joint Stock Company check rolled steel before shipment. (Photo: Hoang Nguyen/VNA)
Since the beginning of the year, steel prices have been continuously adjusted up, with a total increase of more than 1 million VND/ton.
Although currently, the upward momentum has slowed down, but many information that steel prices will continue to increase in the coming months.
Surveyed at iron and steel dealers on De La Thanh, Tam Trinh ... (Hanoi), steel prices have continuously increased in recent days. The current steel price has exceeded the threshold of 17 million VND/ton (the price at the agent).
Mr. Ngo Khanh, an iron and steel dealer in De La Thanh, said that since the beginning of the year, steel prices have increased 5 times, with a total increase of about 1 million VND/ton. The reason given by the mills is that the price of steel billets and raw materials both increased, causing product prices to increase accordingly, bringing the price of this product into a new upward trend after a sharp decline in the last months of last year.
The most recent price increase fell on February 22. However, while talking with reporters, the owner of this iron and steel dealer continued to receive a notice to increase steel prices on March 6, with an increase of 200,000 VND/ton.
Currently, the price of iron and steel at dealers has exceeded 17 million VND/ton. This price increased about 7% compared to the end of last year but compared to the peak of nearly 21 million VND/ton last year, still about 15% lower.
The price of rolled steel in the North is about 17.5 million VND/ton, in the Central region has increased to 17.6-17.8 million VND/ton, depending on the standard; and in the South, the price of steel also increased to 17.49 million dong/ton, depending on the type.
The Vietnam Steel Association (VSA) said that steel prices have increased continuously over the past time mainly because the import prices of input materials for steel production such as coal, iron ore, scrap steel, hot-rolled coils ... have not been available. signs of stopping the uptrend.
The selling price of finished steel increased slower than the growth rate of input materials, so the business efficiency of construction steel companies was still low, with difficulties from purchasing input materials to consuming output finished products. VSA believes that the high price of raw materials causes domestic factories to increase selling prices many times to compensate for production costs and reduce losses.
Information from VSA shows that iron ore prices increased by about 6.5 USD/ton compared to the beginning of December 2022. Similarly, the price of export coking coal at the Australian port traded at about 282.5 USD/ton, a sharp increase of 52.25 USD/ton compared to the beginning of December 2022. Scrap steel price also increased by 500-700 thousand VND/ton, to 8.9-9.5 million VND/ton… Imported scrap price also increased sharply by 50 USD/ton, to 400 USD/ton from the end of December. 2022.
The price of billet shipped by sea continued to rise from days ago when only a handful of mills in Southeast Asia offered billet for sale, with one Indonesian mill reportedly offering at $610-$615/ tons FOB Indonesia.
Market commentary, the Commodity Exchange of Vietnam (MXV) said signs of stabilization in the real estate market have helped lift iron ore futures prices.
Producing rolled steel for export at JFE Shoji Hai Phong Steel Co., Ltd, invested by Japan, at VSIP Hai Phong Urban Industrial Park. (Photo: Danh Lam/VNA)
Along with that, according to the World Steel Association (WS), the total global crude steel production will reach 1,878.5 million tons in 2022, down 4.2% compared to 2021, with the top three producers respectively. China, India, Japan and the US. In the context of slowing supply growth, the prospect of better consumption in the fields of construction and infrastructure investment, especially in Asia, will be a guide for the recovery of iron prices. steel and is an advantage for producing countries.
In Vietnam, demand for iron and steel is also expected to improve in 2023 when more public investment projects are deployed. Recently, the Ministry of Transport was assigned by the Government to disburse public investment with a capital of 94,000 billion VND, 1.7 times higher than in 2022.
Therefore, iron and steel prices are forecasted to continue to increase in the near future, when the supply of iron ore is tight, while the demand tends to increase higher.
Mr. Ngo Khanh, an iron and steel dealer, said that normally every year, iron and steel prices will rebound sharply from March to June. Like last year, within 2-3 months of the next 2 and 3 quarters. Steel price continuously increased and exceeded 20 million VND/ton. It is expected that this year, the increase will also have a similar situation when many indicators of tight supply.
According to the Securities Joint Stock Company of Bank for Investment and Development of Vietnam (BSC), in the first quarter of this year, steel price may recover 2-3% over the same period due to seasonality and world steel price. world recovered when China opened up. In the next 2nd and 3rd quarters, steel price movements will depend on the level of recovery from steel demand.
According to BSC, the expectation that the Chinese market will recover and the target of domestic public investment disbursement expected to increase by 20-25% will be the driving force for the recovery of the steel industry in the second half of this year.
However, the momentum was also affected with the view that the recovery in demand is still slow in 2023, steel supply may increase again when China opens up.
According to Duc Dung (VNA/Vietnam+)
