Investors seem to consider Vietnam an ideal place for steel mill projects, which explains why they have brought big projects worth several billion dollars each to Vietnam. However, experts have warned that too many steel mills will lead to waste.
According to the Vietnam Steel Association (VSA), Vietnam now has to import 3.5mil tonnes of steel a year. It is estimated that the total demand for plate steel will be some 4.7mil tonnes by 2010, 7.2mil tonnes by 2015, and 10.2mil tonnes by 2020. The demand for plate steel accounts for 50% of the total demand in Vietnam.
If counting the demand for construction steel, which is expected to see the same growth rate in demand as plate steel, Vietnam will need 10mil tonnes of steel of different kinds by 2010, 15mil tonnes by 2015 and 20mil tonnes by 2020.
Such a big demand can be seen as a big opportunity for investors and the steel industry, which explains why foreign investors are rushing to set up steel mills in Vietnam. However, experts have warned that too heavy of investment in the steel industry will cause waste as supply will exceed demand.
The Vietnam Steel Corporation (VSC) on May 29 signed a memorandum of understanding on the implementation of the $3.5-4bil Ha Tinh steel complex project with India’s Tata group, the sixth-biggest steel group in the world. Once operational, the steel mill will churn out 4.5-5mil tonnes a year.
Another big steel project is waiting for licencing – the one to be run by the joint venture between Korea’s Posco and Vietnam’s Vinashin. The $5bil steel project, expected to be located in Khanh Hoa province, will put out 5mil tonnes a year.
The two projects alone will have the total capacity of 10mil tonnes a year by 2015. If considering the current capacity of 6mil tonnes a year of operational steel mills, and another 6mil tonnes able to be produced by that time, Vietnam will be able to produce 20mil tonnes of steel of different kinds by 2015.
Other big steel projects are to be kicked off in some days. These include the one invested in by Tycoons Group International ($1bil), which was licenced in September 2006. The 2mil tonne/year steel mill invested in by India’s Essar and VSC in Ba Ria-Vung Tau is awaiting a licence. The construction of a series of smaller projects, capitalised at $30-60mil, is to start in some days
Source: VNE
Showing posts with label VSC. Show all posts
Showing posts with label VSC. Show all posts
Thursday, May 31, 2007
Tuesday, May 29, 2007
Tata takes major stake in Vietnam steel plant
India's Tata Steel Ltd. (TISC.BO: Quote, Profile , Research), the world's sixth-largest steel maker, will join forces with state-run Vietnam Steel Corp. (VSC) to build parts of a steel complex with a total $3.5 billion in investment.
Tata will take a stake of up to 65 percent in a steel plant venture with Vietnam and a 30 percent stake in a nearby iron ore mine. Both are part of the complex that Tata will build with VSC, the country's top steel maker.
Tata signed a memorandum of understanding with VSC to conduct a feasibility study by September 2008 on a complex with capacity for 4.5 million tonnes of steel products by 2018.
"The project aims to optimise the resources from Thach Khe iron ore mine in Ha Tinh province to turn out steel products to meet economic demand," VSC Chief Executive Dau Van Hung said.
Hung was referring to the central coastal province of Ha Tinh, 340 km (210 miles) south of Hanoi. The Thach Khe mine is 12 km east of the north-south Highway One, close to the sea.
Its iron ore reserves are estimated at more than 500 million tonnes, which are located deep below sea level, of which around 300 million tonnes would be recoverable, said Pham Chi Cuong, chairman of the Vietnam Steel Association.
"The size of the mine is average, but the ore has a high iron content of more than 60 percent," Cuong told Reuters.
Cuong said the complex would produce steel plate and sheet, which have not been manufactured in Vietnam, one of the world's fastest growing economies but which has to import half its steel product demand, mainly from China.
"The project will serve as the backbone for Vietnam's steel industry during 2015-2020," he said.
Tata Managing Director B. Muthuraman estimated Vietnam's steel product demand at 7 million tonnes a year.
But January to May's imports of steel and billets into Vietnam have already jumped 39.5 percent from a year earlier to 3 million tonnes, government statistics showed.
"The proposed joint venture with Tata Steel for the steel plant shall further strengthen the domestic production of primary steel and lower the dependence of Vietnam on imported billets and slabs," Muthuraman said.
VSC has been running 12 subsidiaries and 14 joint ventures with foreign companies in the industry. It said its total capacity stood at 5 million tonnes of products per year, including the output of its ventures.
In March it secured an investment licence to develop a $527 million hot-rolled steel mill in the southern province of Ba Ria-Vung Tau with India's Essar group and the Vietnam General Rubber group.
Source: Reuters
Tata will take a stake of up to 65 percent in a steel plant venture with Vietnam and a 30 percent stake in a nearby iron ore mine. Both are part of the complex that Tata will build with VSC, the country's top steel maker.
Tata signed a memorandum of understanding with VSC to conduct a feasibility study by September 2008 on a complex with capacity for 4.5 million tonnes of steel products by 2018.
"The project aims to optimise the resources from Thach Khe iron ore mine in Ha Tinh province to turn out steel products to meet economic demand," VSC Chief Executive Dau Van Hung said.
Hung was referring to the central coastal province of Ha Tinh, 340 km (210 miles) south of Hanoi. The Thach Khe mine is 12 km east of the north-south Highway One, close to the sea.
Its iron ore reserves are estimated at more than 500 million tonnes, which are located deep below sea level, of which around 300 million tonnes would be recoverable, said Pham Chi Cuong, chairman of the Vietnam Steel Association.
"The size of the mine is average, but the ore has a high iron content of more than 60 percent," Cuong told Reuters.
Cuong said the complex would produce steel plate and sheet, which have not been manufactured in Vietnam, one of the world's fastest growing economies but which has to import half its steel product demand, mainly from China.
"The project will serve as the backbone for Vietnam's steel industry during 2015-2020," he said.
Tata Managing Director B. Muthuraman estimated Vietnam's steel product demand at 7 million tonnes a year.
But January to May's imports of steel and billets into Vietnam have already jumped 39.5 percent from a year earlier to 3 million tonnes, government statistics showed.
"The proposed joint venture with Tata Steel for the steel plant shall further strengthen the domestic production of primary steel and lower the dependence of Vietnam on imported billets and slabs," Muthuraman said.
VSC has been running 12 subsidiaries and 14 joint ventures with foreign companies in the industry. It said its total capacity stood at 5 million tonnes of products per year, including the output of its ventures.
In March it secured an investment licence to develop a $527 million hot-rolled steel mill in the southern province of Ba Ria-Vung Tau with India's Essar group and the Vietnam General Rubber group.
Source: Reuters
Saturday, May 26, 2007
Vietnam Steel and Tata join for venture
State-run Vietnam Steel Corp. (VSC) is to sign an agreement on May 29 with India's Tata Steel Ltd. for a steel complex, a VSC executive said on Friday.
The government said the total investment would be $3.5 billion.
VSC Chairman Mai Van Tinh said in an invitation sent to Reuters that the Vietnamese firm would sign a memorandum of understanding with Tata on Tuesday in Hanoi, following government approval granted on May 18.
The steel complex, to be built in the central province of Ha Tinh, 340 km (210 miles) south of Hanoi, would refine iron ore from Thach Khe mine to produce 4.5 million tonnes of steel products per year, the government has said.
It was not clear how much of investment each side would contribute to build the complex but the major steel project, along with those planned by South Korea's POSCO, could help Vietnam reduce its reliance on steel imports.
The Hanoi-based unlisted VSC has been running several ventures with foreign companies to expand domestic production.
In March VSC won an investment licence to develop a $527 million hot-rolled steel mill in the southern province of Ba Ria-Vung Tau with India's Essar group and the Vietnam General Rubber group.
Steel and billets imported to Vietnam mainly come from China. Last year Vietnam's imports of the products edged up 1.8 percent from 2005 to 5.62 million tonnes, government statistics said.
However, a robust demand of the construction sector has prompted January-to-May's imports of steel and billets to jump 39.5 percent from a year earlier to 3 million tonnes, the General Statistics Office said on Friday.
The import value would also soar 64.7 percent to $1.7 billion, the office said in its monthly report.
Source: Reuters
The government said the total investment would be $3.5 billion.
VSC Chairman Mai Van Tinh said in an invitation sent to Reuters that the Vietnamese firm would sign a memorandum of understanding with Tata on Tuesday in Hanoi, following government approval granted on May 18.
The steel complex, to be built in the central province of Ha Tinh, 340 km (210 miles) south of Hanoi, would refine iron ore from Thach Khe mine to produce 4.5 million tonnes of steel products per year, the government has said.
It was not clear how much of investment each side would contribute to build the complex but the major steel project, along with those planned by South Korea's POSCO, could help Vietnam reduce its reliance on steel imports.
The Hanoi-based unlisted VSC has been running several ventures with foreign companies to expand domestic production.
In March VSC won an investment licence to develop a $527 million hot-rolled steel mill in the southern province of Ba Ria-Vung Tau with India's Essar group and the Vietnam General Rubber group.
Steel and billets imported to Vietnam mainly come from China. Last year Vietnam's imports of the products edged up 1.8 percent from 2005 to 5.62 million tonnes, government statistics said.
However, a robust demand of the construction sector has prompted January-to-May's imports of steel and billets to jump 39.5 percent from a year earlier to 3 million tonnes, the General Statistics Office said on Friday.
The import value would also soar 64.7 percent to $1.7 billion, the office said in its monthly report.
Source: Reuters
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