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Ministry of Industry and Trade: Need specific policies to develop the steel industry

Autonomy in domestic steel production is an indispensable requirement of the self-reliance in raw materials for production and consumption of the people, as well as the process of urbanization and modernization of national facilities.

Ministry of Industry and Trade: Need specific policies to develop steel industry - Photo 1.

Vietnam’s steel industry basically depends on imported raw materials. (Illustration image – Photo: Investment Newspaper)

This is the content of the proposed report on the construction of “Development strategy”. steel industry Vietnam to 2030, vision to 2050″ of the Ministry of Industry and Trade.

In recent years, the steel industry has had a strong development in capacity as well as technology. A number of steel factories with large capacity and high quality steel have been invested and put into operation.

As of 2021, the billet production capacity of domestic enterprises is 27 million tons/year, of which hot-rolled coil (HRC) is 7-8 million tons/year.

With construction steel, the domestic production capacity of about 14 million tons will ensure 100% of domestic consumption demand as well as meet a part of export demand. In which, 42% of production is used from imported steel scrap; 58% is produced from blast furnaces, using iron ore as raw materials.

With steel for mechanical engineering and manufacturing, Vietnam has also produced and supplied a part of HRC hot rolled coil (about 8 million tons/year). As for alloy steels, Vietnam has not yet been able to produce special steels.

However, besides new factories with large capacity such as: Hoa Phat Dung Quat Iron and Steel Complex, Hung Nghiep Formosa Iron and Steel Complex, Nghi Son Steel. the remaining billet factories mainly have small capacity, outdated equipment, and limited steel production capacity. Domestically produced steel products cannot supply enough steel demand for the whole economy.

The Ministry of Industry and Trade recognizes that the competitiveness of Vietnam’s steel industry is quite low when most of the input materials for steel production must be imported. Besides, there are still factories with small capacity, outdated equipment, energy consumption and environmental risks.

Vietnam’s steel industry basically depends on foreign imported raw materials such as iron ore, scrap steel, coking coal, graphite electrode… so when the price of input materials fluctuates, it will make the price of steel more expensive. Domestic products must also adjust to the world market.

The Ministry of Industry and Trade forecasts that in 2022, Vietnam will have to import many types of materials for steel production such as iron ore for blast furnaces about 18 million tons, scrap steel about 6 to 6.5 million tons for furnaces. electricity, coking lignite about 6.5 million tons and graphite electrode about 10,000 tons…, the price of iron ore, scrap steel, raw material ore and coking lignite… remain high, which will directly affect the steel production enterprises and the domestic steel market.

According to the Ministry of Industry and Trade, in the period 2016 – 2021, the steel industry has had a rapid but unbalanced development between upstream and downstream development. The following steel products such as galvanized steel sheet, steel pipe have good growth in production and export value.

Meanwhile, all kinds of alloy steel, especially HRC – an essential input material for many industries such as cold-rolled steel (CRC) production, galvanized steel, steel pipes, shipbuilding, mechanical engineering are in high demand. demand is large, but the domestic production capacity has not yet met the demand, so it continues to have to import in large quantities.

In the long term, to ensure the demand for HRC and other high-quality alloy and steel in the country, it is necessary to continue to attract and invest in a number of large steel production complexes to serve domestic demand, reduce gradually dependent on imported steel.

The Ministry of Industry and Trade believes that the steel industry plays a particularly important role in the process of developing the country towards industrialization and modernization; is the foundation industry, input materials for important economic sectors of the country such as mechanical engineering, supporting industry… On the other hand, developing a strong steel manufacturing industry is also creating a foundation. a solid foundation and market development for the manufacturing, construction, and mechanical industries, etc., contributing to a stable supply source and improving the productivity and operational efficiency of the industries.

The steel industry also makes an important contribution to the process of transformation and urbanization of the country, affecting many aspects of socio-economic development. With steel consumption per capita of Vietnam (about 240kg/person/year) still very low compared to other countries in the region such as Malaysia, China, the room and development potential of Vietnam’s steel industry. in the near future is huge.

Although the steel industry plays a particularly important role in the process of developing the country towards industrialization and modernization, the Ministry of Industry and Trade believes that, at the present time, Vietnam does not have a specific policy. separate to promote, as well as orient to develop the steel industry.

For the steel industry to develop sustainably and stably, the Ministry of Industry and Trade said that the State needs to develop strong enough policies to promote the development of the steel industry, creating a basic foundation for industrialization towards the direction of the steel industry. modern and sustainable, such as having preferential policies on land, infrastructure, science and technology and training human resources to encourage and promote steel projects to develop in order to form a strong industry. metallurgy, meeting the process of industrialization and modernization of the country.

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