Vietnam Steel Gurus cut steel prices by VND200,000-300,000 a tonne from June 11 in an effort to release inventory, theSaigontimes quoted Pham Chi Cuong, chair of Vietnam Steel Association as saying.
Steel producers’ report showed that ex-work steel prices fell to VND15 million/tonne (VAT exclude) from previous VND15.3 million, Cuong said, adding that big steel producers involved are Haa Phat, Thai Nguyen, Vina Kyoei, Thep Viet, South Steel.
The other reason behind the move was input steel prices fell from $15 to $20 a tonne, Cuong added.
In May, steel sales were 350,000 tonnes, a very low level that pushed producers to cut prices further. As of May 31, steel inventory was roughly 315, 000 tonnes and many steel producers have to haul or slow down production.
VSA data shows that total local steel production capacity now is 9.2 million tonnes/year while the consumption forecast was only 6 million tonnes/year. The excessive supply of steel was warned by VSA but still many new steel production projects were licensed.