Vietnam Steel Association's chairman Pham Chi Cuong has said that the bankruptcy of many steel manufacturers in 2011 has led to a reduction of 25-30 percent in domestic production capacity, according to local Vietnamese media.
Mr. Cuong said that steel manufacturers may only hope to obtain a modest growth rate of 3-4 percent in output in 2012. It is estimated that the total domestic steel output in 2011 was 7 million metric tons, with a decrease of one percent in comparison with 2010.
Meanwhile, according to Vietnam's Ministry of Industry and Trade (MOIT), in the last months of 2011 steel manufacturers have been keeping production at a moderate level, because they anticipated low demand. However, the country's steel output has exceeded demand due to difficulties relating to steel investment projects. In order to ease overproduction, steel manufacturers have been trying to export steel. About two million metric tons of steel were exported in 2011, worth nearly $2 billion. On the other hand, Vietnamese exporters have been facing difficulties in the export markets, including the antidumping lawsuits.
It is expected that investments in steel projects in Vietnam, both by domestic and foreign investors, will slow down over the next five years at least.