SE Asia’s largest ferrous scrap importer – Vietnam has witnessed an upsurge due to active restocking on strong steel demand. The country imported 5.85 mn t ferrous scrap in CY’20, up by 13% y-o-y from 5.2 mn t in CPLY. Remarkably, scrap imports have climbed to an eight–year high, as per data recorded with SteelMint.
Imports from Japan up 55% y-o-y – Vietnam’s scrap import volumes have increased sharply from Japan by 55% y-o-y to 3.41 mn t. US remained the second largest scrap supplier with a volume of 1.03 mn t in CY’20, down by 17% y-o-y basis.
Imports have observed a sharp rise of 40% m-o-m in Dec’20 imported scrap volumes. Imports stood at 0.73 mn t in Dec’20. Active restocking on strong steel demand, boosted imports.
Key drivers of ferrous scrap imports in CY’20 –
- Vietnam’s GDP growth rose to 2.91% in 2020 – In 2020, Vietnam’s GDP growth was at 2.91%. Although its lowest increase in recent decade but it is a success in the context of Covid-19 pandemic, as per data received from VSA
- Growth in construction & manufacturing sector – Vietnam’s construction and manufacturing sectors played a key role in leading the economic growth. Growth in industry and construction sector stood at 5.6% y-o-y basis
- Finished steel production – Vietnam’s crude steel production during Jan–Nov’20 increased to 26.6 mn t, up by 44% y-o-y, as per WSA data.
Market highlights of Dec’20 – - Domestic steel scrap prices increased by VND 600-700/kg a VND 8450/8600/kg. Imported scrap prices surged by $135/t to $475/t in Dec’20, as per VSA data
- Steel billet prices rose by $89/t to $586-588/t, domestic billet prices increased by VND 1,800-2,000/kg to VND 13,400-13,600/kg
Outlook – With ramping up of steel capacities, ferrous scrap imports are likely to remain on the higher side.
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