As per the latest updates, Vietnam’s steel major, Hoa Phat have recorded a 3.5 fold increase in its construction steel sales in May 2019 with its sales volume touching 226,000 tonnes. In the first five months of 2019 (Jan-May), the same has been recorded at 1.16 MnT, up by 22.4% against the corresponding period of the previous year.
According to the company’s management, the sales increased particularly in the civil construction sector as the group was able to give a better supply to the market. Vietnam has one of the fastest growing economies in the world. The country’s construction industry is booming and new infrastructure, high-rise buildings, and private housing projects are shaping the skylines of cities across the country.
In terms of overseas sales, the company’s exports volume also rose by 21.4% y-o-y basis to about 106,400 tonnes during Jan-May’19 with major export destinations being Japan, U.S., Canada and ASEAN countries such as Cambodia, Malaysia and Laos.
In late May, the group shipped the first batch of 6,000 tonnes of quality rolled steel to Japan. Another 18,000 tonnes are waiting for delivery abroad in June. Also during the month, it exported the first two containers of steel wires to Malaysia.
What else has contributed to the company’s sales growth?
Along with the positive demand in the construction sector, the company is also contributing its growth in sales to the completion of the construction steel production line at the Hoa Phat Dung Quat Iron and Steel Production Complex. Hoa Phat Dung Quat complex is designed to have a total of 11 ports, able to handle up to 32 MnT of goods each year.
Hoa Phat plans to produce some 3.3 MnT of construction steel in 2019. Last year, it shipped 240,000 tonnes of steel abroad, up 50.97% against the previous year.
Never before had the group received such large orders from its traditional markets – including Japan, the US, Cambodia, and Malaysia – like it did in 2018. The strongest growth last year was seen in Japan, with total steel orders increasing 20 times to over 58,500 tonnes, followed by Cambodia at a 246% increase and Malaysia with a rise of 202%.
Cambodia was the largest customer of Hoa Phat in 2018 with nearly 70,000 tonnes, and will continue to be a market with great potential for Hoa Phat steel as the neighbouring country’s steel industry has not yet developed, while demand is high for the construction of high-rise buildings.
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