The Vietnam Steel Association (VSA) has stated that Vietnam’s crude steel production reached an estimated 14.8 million mt in the first half of the year, up 21.2 percent year on year, while steel consumption increased 13.1 percent to approximately 17.9 million mt, providing a solid foundation for further growth, according to Vietnamese media reports.
Despite this positive performance, the industry continues to face significant challenges from rising trade barriers, stricter environmental requirements and ongoing volatility in global markets.
Trade barriers and CBAM increase pressure on exporters
Steel exports have remained under pressure since the beginning of the year as global overcapacity has continued to fuel protectionist measures in major markets. The US has imposed tariffs of up to 50 percent on certain steel products under Section 232, while Vietnamese steel products continue to face trade remedy investigations and stricter origin, quality and technical requirements. As a result, Vietnamese producers are under increasing pressure to strengthen compliance procedures, improve supply chain management and meet more demanding customer requirements. At the same time, greenhouse gas reduction obligations and the Carbon Border Adjustment Mechanism (CBAM) have become increasingly important for maintaining access to key export markets.
The pressure is particularly significant because steel is one of the sectors covered by the EU’s CBAM. Failure to modernize production technology, reduce emissions and provide transparent carbon reporting could weaken the competitiveness of Vietnamese steel exports in traditional high-value markets. In addition, the industry remains exposed to fluctuations in imported raw material prices, including iron ore and scrap, while volatility in freight rates, exchange rates and geopolitical developments continues to create uncertainty for production costs and profitability.
VNSteel targets higher-value production
According to Phạm Công Thảo, deputy general director of Vietnam Steel Corporation (VNSteel), the outlook for 2026 remains positive, supported by stable domestic demand. VNSteel aims to achieve strong growth while maintaining its leading position in the domestic industry and contributing to Vietnam’s broader economic growth objectives.
The company plans to increase investment in higher-quality steel products to gradually replace imports, particularly in defense, security and other strategic industrial sectors where domestic production remains limited. VNSteel is also focusing on strengthening corporate governance, improving operational efficiency and implementing targeted investments to enhance productivity and product quality.
VSA forecasts higher steel production in 2026
Despite stronger domestic demand, export performance has weakened. According to the VSA, steel exports totaled 1.79 million mt in the first half of the year, down 4.8 percent year on year, reflecting uneven global demand, fluctuating steel prices and increasingly restrictive trade measures.
Nevertheless, the association forecasts that Vietnam’s crude steel production will reach 27 million mt in 2026, up 10 percent year on year. Finished steel production is expected to increase to 33 million mt, while domestic steel consumption is projected at 28 million mt and exports at six million mt. Steel imports are forecast to decline, indicating stronger domestic production capacity and the impact of market management and trade defense measures.
Industry calls for stronger protection and green transition
VSA chairman Nghiem Xuan Da stated that the industry must strengthen protection of the domestic market against low-priced and low-quality imported steel and unfair competition. He called for stricter quality control requirements for imported steel products, including mandatory compliance with Vietnamese standards before they are allowed onto the domestic market. He also emphasized that steelmakers need to accelerate their green transition and digital transformation by investing in energy-efficient technologies, resource optimization and emissions reduction. According to the VSA, steel producers should also strengthen compliance with rules of origin and improve transparency throughout their raw material sourcing and supply chains in order to reduce the risk of anti-circumvention investigations and enhance their reputation in export markets. The association also called on the government to strengthen early warning systems and market forecasting, provide greater support to companies involved in trade remedy investigations, continue improving technical standards and steel product regulations, and implement stable long-term investment policies consistent with Vietnam’s international commitments.
Meanwhile, Vietnam’s Minister of Industry and Trade Lê Mạnh Hùng stated that the ministry will continue reviewing regulations and consulting with businesses and industry associations to reduce administrative procedures, lower costs and facilitate production and trade. He added that the ministry will continue maximizing the benefits of free trade agreements, supporting sustainable export growth, strengthening trade remedy early warning systems and working with other government agencies to address market obstacles, promote industrial development, increase localization rates and build more resilient domestic supply chains to improve the international competitiveness of Vietnamese products.