Construction steel prices increase

Recently, the price of construction steel ex-factory excluding VAT at domestic factories has increased significantly.

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Regarding construction steel, in July, production output was estimated at about 780 thousand tons, up 24.1% over the same period in 2016 and up 7% over the previous month, steel consumption output was estimated at about 740 thousand tons.

According to the report of the Price Management Department - Ministry of Finance, in July 2017, due to the impact of steel billet and scrap steel prices on the world market, construction steel prices increased by 150 - 300 VND/kg, depending on the type and brand of steel. Currently, the selling price at factories excluding discounts and VAT is around 10,000 - 12,300 VND/kg for rolled steel and around 10,100 - 12,400 VND/kg for steel bars.

Specifically, the price of construction steel at Viet Y Steel Factory is currently 12.38 - 12.58 million VND/ton excluding VAT, the price of 20mm diameter steel bars of Hoa Phat is 12.180 - 12.38 VND/ton excluding VAT, some smaller steel factories have the price of steel bars even up to 12.90 million VND/ton. This price increased by 15-17% compared to the end of the second quarter of 2017.

Retail construction steel prices in the Northern and Central provinces range from VND10,100 - 12,500/kg; in the Southern provinces, they range from VND10,200 - 12,800/kg.

Regarding the world market, the offering price of steel billet in July 2017 tended to increase by about 5 - 10 USD/ton compared to June 2017. Specifically, the offering price of steel billet CFR East Asia was about 410 - 425 USD/ton, the offering price of CIS billet was about 385 USD/ton FOB Black Sea.

According to industry experts, the reason for the increase in steel prices is: The construction season is about to start, construction demand is increasing, but the main reason is the impact of Chinese steel prices. The restructuring of China's steel industry, factories causing environmental pollution have stopped production and high demand for steel in China, due to increased investment in infrastructure construction, has caused the world's billet and hot-rolled steel prices to increase sharply since May. Upstream materials such as iron ore, coke and scrap steel have also increased significantly.

According to Construction Newspaper