Vietnam: Steel Price to Keep Soaring in 2008-VSA

Prices of steel will likely continue to increase in early 2008 due to price hikes of input materials, said Pham Chi Cuong, chairman of Vietnam Steel Association.

 

Iron ore price in the global market will be up 30 per cent and coke coal by 20 per cent next year, Pham Chi Cuong claimed, noting that the steel price soaring is also fed by China's policies to limit exports of semi-finished products like steel ingot via tax raising over steel ingot to 15 per cent and likely to 25 per cent next year.

 

The direct impacts from China's policies over steel export are inevitable as Vietnam now has to import 60 per cent of its steel ingot consumption, 50 per cent of which sourced from China, Vnexpress website said.

 

In addition, Indian steel makers said that they may raise by US$5 to US$8 a ton after an increase of US$20 in October, the website noted.

 

Local coal producers, meanwhile, said earlier that they will also increase prices of coal in next year due to inflation soaring.

 

Currently, construction steel price climbed to record high level of VND15 million (US$937.5) a ton, far higher than expectation of VND13 million in mid November, said state run Lao Dong web site.

 

Steel expenditure account for 26 per cent total spending, said senior director of a bridge construction company. He noted that with the ever high prices, many constructors will face bankruptcy sooner or latter. (Local sources)