Vietnam may take remedial action against imported steel as an influx of cheap imports has reportedly threatened the local steel industry.
News website Bao Dau Tu reported Friday that local producers have received support from Deputy Prime Minister Hoang Trung Hai. He ordered the Ministry of Industry and Trade to provide steel producers with guidance and consultancy on the actions, when necessary, according to the website.
Figures from the Vietnam Steel Association showed that the country imported 12.62 million tons of iron and steel in the first ten months, up 34 percent year on year and posting the revenues of US$6.28 billion. More than 61 percent of the imports were from China.
Chairman Ho Nghia Dung told the website that the excessive imports of Chinese steel have put a lot of pressure on local producers who have struggled to sell their products.
Local steel output is estimated 22 million tons now with many products' supplies already doubling local demand, he said, noting that many factories are on the verge of closing down.
Last month the association sounded alarm on the increasing imports of Chinese chrome alloy steel billets.
In a letter to relevant agencies, it said the product, which contains 0.3-0.4 percent chrome content, is imported tax-free under Vietnam's existing laws.
But the very small chrome content does not add any value to the steel billets, meaning they cannot be used for making high-quality products, it said.
Following the association's complaint, the Ministry of Finance proposed imposing import duty of 10 percent on chrome alloy steel, while the Ministry of Industry and Trade recently launched an investigation into five importers of the questioned product.
Vietnam imported 3,000 tons of alloy steel billets in August at nearly $1 million, but the amount soared to over 62,000 tons in September with the revenues of over $20 million, according to the association.