The Ministry of Industry and Trade has proposed the Government consider policies to tighten exports of steel products to stabilise the domestic market amid soaring steel prices in recent months.
At a recent Government meeting, Deputy Prime Minister Le Minh Khai asked the ministry to find solutions to increase domestic steel production and ensure supply and demand balance.
The ministry said that soaring steel prices had hit not only Vietnam but also the global market. Domestic steel production is heavily dependent on imported raw materials, making a price increase unavoidable.
The ministry said technical barriers and quality standards were being studied to create a healthy market together with the active implementation of trade defence instruments.
A close watch is being kept on the market development to handle the dumping of some steel products into Vietnam as well as to cope with anti-dumping lawsuits on products originating from Vietnam to minimise injuries to domestic producers.
Market watch efforts have also been enhanced to prevent market manipulation or trade fraud which might cause loss to the State budget and negatively affect consumers.
The ministry is studying policies to control exports of steel products which the domestic market has a high demand for to propose to the Government for approval while raising solutions to remove difficulties for steel production investment projects.
According to Truong Ba Tuan, Deputy Director of the Tax Policy Department under the Ministry of Finance, Vietnam could consider adjusting safeguard duties on steel ingots and construction steel products to lower prices.
On March 20, the Ministry of Industry and Trade decided to continue imposing safeguard duties on imported steel ingots for three more years.
Tuan, however, noted that lowering safeguard duties must be put under careful consideration to promote the domestic steel industry and stabilise the domestic market. It was important to have solutions to ensure market supply and demand balance and improve domestic production capacity, he said.
Dang Cong Khoi, Deputy Director of the Price Management Department under the Ministry of Finance, said the whopping rise in raw materials prices, including steel scrap and ingots, from mid-October 2020 had pushed up steel prices globally.
Statistics showed the current prices of raw materials increased by 37-39% against October.
Ore price hit more than US$220 per tonnes on May 10 in the global market, breaking the record of US$194 set a decade ago.
The Ministry of Industry and Trade said soaring steel prices in the domestic market largely affected other industries. Especially as the Government is accelerating the disbursement of public investment to drive economic growth amid the pandemic, high steel prices would push up investment costs and threaten to destroy the Government’s medium-term public investment plan.
According to the Vietnam Steel Association, the domestic steel market would set a new price level in 2021.
The association urged its member manufacturers to expand production and organise efficient distribution systems to help stabilise the domestic market.