Posted on 13 Apr 2023
Against a backdrop of poor demand for its steel both at home and abroad, Hoa Phat Group (HPG), the largest steelmaking group in Vietnam, saw its steel output and sales in March plunge, according to the Hanoi-based group's latest release.
Last month, Hoa Phat produced 440,000 tonnes of crude steel, slumping by 42.3% on year. Meanwhile, the sales volume of its steel products comprising billet, construction steel and hot rolled coil (HRC) also posted a sharp on-year drop of 39.9% to reach 500,000 tonnes, according to the company's data.
Dull demand for steel in Vietnam's domestic market and overseas was the main reason for the slide, with most buyers holding a wait-and-see stance, the company pointed out, stressing that no recovery signs are showing yet in Vietnam's real estate market.
Notably, the steel group's HRC output increased by 13% on month to reach 210,000 tonnes in March, of which 30,000 tonnes were exported to Indonesia and Malaysia, the company's data showed.
Hoa Phat has been actively seeking export orders, the company observed, adding that it expected its HRC exports to increase sharply to European and Asian markets this month, besides those to Southeast Asia.
The March result meant that in this year's first quarter, Hoa Phat produced 1.25 million tonnes of crude steel, dropping by 42% on year, while the sales volume of its construction steel, billet and HRC reached just 1.38 million tonnes, decreasing by 37% on year, the release added.
HPG is the largest steelmaker in Southeast Asia with a total crude steel production capacity of 8.5 million tonne/year, Mysteel Global learned.
Meanwhile, Hoa Phat Group last week lowered its domestic prices of HR coils for May shipment, cutting its prices by $5-10/tonne in dollar equivalent to $680/t, as Mysteel Global reported. Hoa Phat's pricing stance contrasted with that of domestic counterpart Formosa Ha Tinh Steel that raised its domestic prices of such products by $30/t to $725/t dollar equivalent.
Local sources said the reason why Hoa Phat cut its prices was to compete against imports, pointing out that Indian mills had switched their export focus from the Middle East to Asia, and their prices were said to be $700/t CFR for Vietnam and Indonesia.
Table HPG's Jan-Mar steel output and sales volume ('000 t)
Month | Crude steel output | Y-o-Y (%) | Sales volume of steel products | Y-o-Y (%) |
Jan | 392 | -48.6 | 402 | -36.3 |
Feb | 416 | -40 | 475 | -32.9 |
Mar | 440 | -42.3 | 500 | -39.9 |
Q1 | 1,248 | -42 | 1,377 | -37 |
Source: HPG
Source:Mysteel Global
