Production cuts by Vietnam’s major steel mills are likely to continue to widen as export activity shrinks and construction activity remains sluggish. According to local media reports, after Hoa Phat shut down the operation of its four blast furnaces in Hai Doung and Dung Quat provinces, another leading steel mill in Vietnam, Formosa Ha Tinh ( FHS) plans to implement the first phase of production reduction, which is about 15% of production.
A local FHS cooperative trader reported that Formosa Ha Tinh will try to maintain production in November and early December, and decide whether to close the No. 1 blast furnace according to the market situation at the end of the year.
In addition, Hefa is also considering shutting down another blast furnace in Dung Quat at the end of December, which means that by the end of this year, Hefa may shut down 5 of the 7 blast furnaces in total.
According to feedback from local traders, the production cut at Hefa Steel will have a significant impact on supply. Another importer revealed that the current level of inventory in the hands of secondary dealers in Vietnam is low, but due to the continued bearish sentiment, the sentiment to replenish inventory is still not high. Last week, a Chinese exporter reported that in the past month, the export orders of general steel in South America, the Middle East and other markets were relatively large, but the import demand in the Southeast Asian market was sluggish, and the transaction continued to be sluggish.
Post time: Nov-15-2022