The Vietnam Steel Association (VSA) has reported a 15pc drop in steel output to 5.4mn mt, and a decrease in consumption by 20pc to 4.4mn mt, in the first quarter of fiscal 2020, according to Vietnamese media on April 13.
Vietnam steelmakers depend on importing input material from China and the COVID-19 outbreak has disrupted trading between the two countries.
Additionally, Vietnam’s steel exports dropped by 38pc to 300,000mt from the prior year period, VSA said.
Viet Trung Metallurgy and Mineral (VTM) and Vietnam-Italy Steel Joint Stock Company (VIS), member companies of the Vietnam Steel Corporation (VNSTEEL), are most-affected by the COVID-19 impact on trading, VSA said.
VIS expects its total revenue to decline from VND65bn ($2.79mn) to VND3.6 trillion ($$154.57mn) in 2020.
VSA is now seeking government support to minimise the impact of the COVID-19 pandemic on the industry.
It hopes for a cut in interest rates and an extension of debt payment deadlines to ensure a stable supply of raw materials for production, as previously reported by Davis Index.
The association has also forecast that the domestic steel industry is likely to face difficulties this year on the back of a lack of recovery in the infrastructure sector.
Vietnam produced 14.1mn mt of crude steel in 2018.