Hoa Phat Steel’s construction steel output hits a record high of 351,000mt in March 2020, an increase of 42.2pc from the prior year, as per a company report sent to Davis Index. Hoa Phat supplied a total of 486,000mt of finished steel and billet to the domestic and export markets in March.
The group exported 135,000mt of billets in March, which is Hoa Phat’s first-ever billet export shipment. The company also exported 68,000mt of finished steel products. Major export destinations included Japan, Cambodia, Australia, Indonesia and Malaysia.
Hoa Phat’s domestic sales volume increased by almost 2.5 times from the prior year March, despite the impact of COVID-19 outbreak.
Sales volumes improved due to increased demand from construction and infrastructure projects in Vietnam. Sales in the Southern region increased by 89.7pc to 70,000mt, the highest share of domestic sales, followed by 23.2pc rise in the Central region and 14.7pc rise in the North region.
In the first quarter of 2020, Hoa Phat supplied 732,000mt of finished steel, excluding steel billet production, a slight increase from the prior year period. The company supplied 350,000mt of billet with a major portion exported. Finished steel exports were 135,000mt, up 74.8pc from the prior year quarter. The company is optimistic of increasing their billet export volumes in the near term.
Post COVID-19, China continues to import billets as prices in the global market dropped significantly lower than domestic billet prices. Around 500,000mt billet was imported into China in the past couple of weeks at $360-380/mt cfr China. China imports billet from Russia, Indonesia, Vietnam and Brazil. In China construction demand has improved faster than automotive, resulting in higher demand for rebar over flat products. The appetite for billet imports remains high and Vietnam, where new number of cases is on a downtrend, can become a major billet supplier to China.
Vietnam in stats
Vietnam produced 1.78mn mt crude steel in February 2020, up 24.4pc from 1.43mn mt in February 2019. In February, Vietnam’s total ferrous scrap imports rose to 545,933mt, a surge of 152pc from the prior year and up by 55pc from the prior month. Imports from Japan rose to a record high of 354,406mt in February, which is 65pc of Vietnam’s total ferrous scrap imports.