Pham Chi Cuong, chair of Vietnam Steel Association (VSA) said in 2010, the steel price in domestic markets would increase in accordance with the rise of FO price. Lately, from January 4, 2010, the FO price has increased by 400 dong to 13,200 dong per kilogramme. He explained that it would take about 50 kilogrammes of fuel oil (FO) in order to produce one tonne of steel. Therefore, when FO price rose by 400 dong per kilogram, the steel price would increase by 20,000 dong per tonne.
He added that the steel price this year would continue fluctuating but there would be no sudden change due to the fact that domestic supplies were higher than the demands. In addition, there would be more new steel projects to be put into operation in 2010.
VSA also predicted that steel consumption this year would increase by 10-12 percent. There would be 2.652 million tonnes of steel billet to be consumed, up 400,000 tonnes against 2009. The imported volume of steel billet was expected at 2.626 million tonnes, up 10 percent.
On January 5, the price of construction steel stayed at 12 million dong per tonne (exclusive VAT), an increase by 10 percent against that of December 2009.
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