Construction steel sales projected to recover in year-end months

Illustrative image (Source: VNA)

Hanoi – Construction steel sales are predicted to recover in the remaining months of 2020 after a fall in the January-August period due to impacts from the COVID-19 pandemic, according to the Vietnam Steel Association (VSA).

VSA Vice Chairman Trinh Khoi Nguyen said that in the short term, the domestic market will see higher demand after the social distancing period ended, thus bettering sales of construction steel from September.

A VSA report showed that production of construction steel in the first eight months of 2020 reached more than 6.6 million tonnes, down 6.9 percent year on year. Meanwhile, stales of the product reached 6.66 million tonnes, a decrease of 5.8 percent over the same period last year, including 906,962 tonnes exported abroad, down 5.9 percent.

Currently, construction steel inventories stand at more than 604,000 tonnes, which is at a medium level.

The COVID-19 pandemic outbreak in Da Nang in late July and its spread to some other localities greatly affected the recovery of business and production activities as well as the whole economy.

In the first eight months of 2020, production of steel of all kinds reached more than 16 million tonnes, down 5 percent year on year, while sales it nearly 14.44 million tonnes, a decrease of 6.9 percent, including 2.74 million tonnes exported, a drop of 13.8 percent over the same period in 2019.

The increased disbursement of public investment in August and the first eight months of 2020 rose 45.4 percent and 30.4 percent year on year, respectively, the highest in the five-year period thanks to the Government’s efforts to speed up the recovery of business and production, which helped promote sales of steel.

As a result, steel production exceeded 2.34 million tonnes in August, up 11.36 percent over the previous month, while sales reached over 2.07 million tonnes, up 5.88 percent compared to that in July. Export volume also rose 8.81 percent to 462,138 tonnes.

In August 2020, the price of material for construction steel continued the rising trend that began in late July.

The VSA noted that domestic firms are competing fiercely to maintain their market shares, leading to only slight adjustments in steel prices despite the increase in material prices.