Steel industry at scrap shortage risk in Vietnam
The scheduled capacity increase of billets
production in Vietnam may result in steel
scrap shortage, once the intended new capacities come on stream.
Vietnam is planning to bring five new
billet mills into
production by the year 2005, with an aim to avoid high priced imports. According to statistics, the Vietnamese steel industry for the time being can only produce 400'000 mts of billets per year, while the requirement in the country is at 2.5 million mts.
Steel
scrap, used as the raw material in
billet production in minimills is mostly used in the
billet production process in Vietnam. Therefore the country needs to rely on a steady supply of
scrap, to be able to recover from the import dependancy for
billet requirement. According to authorities, through continously increasing
scrap imports Vietnam has finally reached 300'000 mt levels, whereas a lot higher tonnage is needed in order to increase
production and develop the industry.
In addition to such difficulty, the ambiguity regarding the definition of steel
scrap, often causing disputes between environmentalists and steel producers is also creating worries in the industry. A discrimination of the waste material needs to be placed as soon as possible, in order to clarify the situation.
In view of above facts, industry experts point out to a
scrap shortage to be experienced in Vietnam.