Vietnam Iron and Steel Market Outlook to 2028

Vietnam Iron and Steel Market Overview

The Vietnam Iron and Steel Market has experienced significant growth, this is reflected in the global valuation of the Iron and Steel Market, which reached USD 1.80 billion tonnesin 2023. This growth is attributed to increased infrastructure development, urbanization, and industrial activities.

Key players in the Vietnam Iron and Steel Market include Hoa Phat Group, Vina Kyoei Steel Ltd., Pomina Steel Corporation, Thai Nguyen Iron and Steel Joint Stock Corporation, and Southern Steel Corporation. These companies dominate the market due to their extensive production capacities, advanced technologies, and strong distribution networks across the country.

In 2023, The Vietnamese government is investigating potential anti-dumping measures on imported steel products, which could support local manufacturers as they expand their operations. The outlook for the steel industry remains cautiously optimistic, with expectations for continued growth as demand recovers across various sectors.

Cities like Ho Chi Minh City and Hanoi are the two largest cities in Vietnam and play crucial roles in the country's economic development. Their ongoing urbanization leads to increased construction activities, which in turn creates a substantial demand for construction materials, particularly iron and steel.

Vietnam Iron and Steel Market Segmentation

The Vietnam Iron and Steel Market can be segmented based on several factors:

By Product Type: The Vietnam Iron and Steel Market is segmented by product type into construction steel, industrial steel, and special steel. In 2023, construction steel dominated the iron and steel market, driven by ongoing infrastructure developments and urbanization across major cities. The significant demand for high-quality construction materials from both the public and private sectors has solidified construction steel's prominent position in the market.

By Application: The Vietnam Iron and Steel Market is segmented by application into construction, automotive, and manufacturing. In 2023, the construction segment dominated the market, driven by the substantial demand for steel in infrastructure projects such as bridges, roads, and residential complexes. The automotive sector also exhibited significant growth, fueled by increased vehicle production and the need for durable and lightweight materials.

By Region: The Vietnam Iron and Steel Market is segmented by region into North, South, East, and West Vietnam. In 2023, the South region, which encompasses Ho Chi Minh City, dominated the market due to its extensive industrial base and ongoing urban development initiatives. This dominance is attributed to the regions strategic location and well-established infrastructure, which attract substantial investments, further fueling the demand for iron and steel.

Vietnam Iron and Steel Competitive Landscape

Company

Establishment Year

Headquarters

Hoa Phat Group

1992

Hanoi

Vina Kyoei Steel Ltd.

1994

Ba Ria- Vung Tau

Pomina Steel Corporation

1999

Ho Chi Minh City

Thai Nguyen Iron and Steel JSC

1959

Thai Nguyen

Southern Steel Corporation

1975

Ho Chi Minh City

Vina Kyoei Steel Ltd. Collaboration (2024): In 2024, Vina Kyoei Steel Ltd., a joint venture between Japanese and Vietnamese partners, upgraded its wire rod mill in Ba Ria- Vung Tau Province, Vietnam. The company contracted with Primetals Technologies to replace the existing pinch roll and laying head, adding SR Series pipe to extend the laying head pipe life and improve the laying pattern.

Pomina Steel Corporation's Sustainability Initiative (2024): Pomina Steel Corporation launched a sustainability initiative in 2024, they focus on broader business restructuring and investment plans, particularly regarding their blast furnace project and overall financial challenges faced by the company.

Vietnam Iron and Steel Market Analysis

Vietnam Iron and Steel Market Growth Drivers:

Infrastructure Development: The Vietnamese government has earmarked approximately VND 657 trillion (around $26.8 billion) for public investment in 2024, with a significant portion directed towards transportation infrastructure projects, which are allocated about VND 422 trillion (approximately $17.2 billion) of that total.

Industrial Expansion: Vietnam's industrial sector has seen significant expansion, with over 5,000 new factories established in 2024. This growth is driven by both domestic and foreign investments, leading to increased demand for iron and steel for construction and manufacturing purposes. The governments support for industrial parks and special economic zones, such as the Quang Ninh Economic Zone, further fuels this demand.

Automotive Industry Growth: The automotive industry in Vietnam is experiencing robust growth, with over 400,000 vehicles produced in 2023 This surge in production requires substantial amounts of steel for vehicle manufacturing. Companies like Vin Fast have ramped up their production capacities, and the government's focus on promoting electric vehicle manufacturing is expected to further drive steel demand.

Vietnam Iron and Steel Market Challenges:

Environmental Regulations: Stricter environmental regulations introduced in 2024 require steel manufacturers to adopt cleaner production technologies. Compliance with these regulations necessitates significant investments in technology upgrades and pollution control measures. the Ministry of Natural Resources and Environment has imposed new emission standards that steel plants must meet, increasing operational costs.

Fluctuating Raw Material Prices: The volatility in the prices of raw materials such as iron ore and coal presents a major challenge for steel manufacturers. In 2024, the price of iron ore rose to $120 per ton, impacting production costs and profitability. This fluctuation makes it difficult for companies to maintain stable pricing and margins.

Vietnam Iron and Steel Market Government Initiative:

National Steel Development Plan 2024: The Vietnamese government has launched this initiative, which aims to increase domestic steel production capacity. The plan includes various supportive measures such as financial incentives, tax breaks, and assistance for technology adoption to enhance the competitiveness of local steel manufacturer.

Vietnam Information and Communications Infrastructure Master Plan: The Vietnam Information and Communications Infrastructure Master Plan, introduced in 2024, serves as a strategic framework designed to guide the development of the country's IT infrastructure over the coming years. This comprehensive plan outlines specific goals and targets aimed at enhancing the digital landscape in Vietnam, promoting the growth of information and communication technologies (ICT) across various sectors.

Vietnam Iron and Steel Market Outlook

By 2028, the Vietnam Iron and Steel Market is projected to maintain its upward trend, fueled by ongoing infrastructure initiatives and the country's industrialization efforts. The government's commitment to self-reliance and sustainable development, along with advancements in steel production technologies, is expected to foster consistent market growth and enhance competitiveness on a global scale.

Future Trends

Technological Innovation: Over the next five years, technological innovation will play a crucial role in the Vietnam Iron and Steel Market. Companies are expected to invest in advanced production technologies, such as AI and IoT, to enhance efficiency and reduce costs. By 2028, the adoption of these technologies are likely to lead improvements in production efficiency and reductions in operational costs, as supported by industry reports.

Sustainable Practices: The focus on sustainability will continue to shape the future of the Vietnam Iron and Steel Market. By 2028, it is anticipated that more companies will implement recycling programs and adopt green technologies. Government initiatives like the Green Technology Adoption Program will drive these changes, leading to a reduction in carbon emissions from the steel industry.
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