Though the economic outlook in January and February has brightened, steel production, domestic consumption and exports plunged, according to the Vietnam Steel Association (VSA).
In the first two months of 2023, the output of finished steel products fell 16.3% year-on-year to nearly 4.3 million tons.
Steel sales were down 23.2% over the same period in 2022 to 3.8 million tons. Steel exports contributed one million tons to the total, decreasing 10.4% over the year-ago period.
In February alone, the production of finished steel products rose nearly 22% month-on-month, but dipped 8.9% year-on-year, at 2.35 million tons.
Similarly, steel consumption in the month amounted to some 2.1 million tons, up 18.1% over January, but down 19% against the previous February.
The drop in the industrial production index in many localities, coupled with businesses that have pulled out of the market outnumbering those entering or returning to the market, has adversely affected steel output and consumption, the association said.
Meanwhile, the prices of input materials for steel production increased.
On March 7, hard coking coal was priced at US$331 per ton on a free-on-board basis at Australian ports, up US$6 per ton compared to early February, while steel scrap prices inched up US$13 to US$448 per ton.
On the same day, hot rolled coils (HRC) were traded at US$643 per ton on a cost and freight basis, an increase of US$24 compared to the beginning of February.
The HRC price volatility on the global market has affected Vietnamese flat steel manufacturers as they use HRC as production materials, the Vietnam Steel Association said.