Thursday,  May 13, 2021,23:12 (GMT+7) 0 0
VACC seeks reason for steel price upsurge
The Saigon Times
Friday,  Apr 23, 2021,14:13 (GMT+7)

VACC seeks reason for steel price upsurge

The Saigon Times

The H-shaped steel product seen at a warehouse. The Vietnam Association of Construction Contractors has proposed the Government Office promptly direct the relevant ministries and agencies to launch a probe into the rising prices of steel – PHOTO: VNA

HCMC – The Vietnam Association of Construction Contractors (VACC) has proposed the Government Office promptly direct the relevant ministries and agencies to launch a probe into the rising prices of steel to minimize the losses of local construction firms.

Some VACC members are on the edge of bankruptcy and afflicted as steel prices have been on the rise since late 2020, resulting in the proposal, according to the association.

The price of each ton of steel has soared by up to 40% against that seen in late 2020. The Viet My steel sells for VND18.4 million per ton in Danang City, while the price stood at VND13.1 million per ton at the end of last year.

Vietnamese contractors have faced difficulties in the upsurge as most investors signed construction contracts with fixed prices that cannot be adjusted up, said VACC Chairman Nguyen Quoc Hiep.

VACC said that the steel price set by the Danang Construction Department for payments of projects was VND13.8 million per ton, while the market price of steel had risen to VND17-18 million per ton.

Steel accounts for 10%-30% of the total value of each civil construction project, so the fluctuation in steel prices severely affects contractors.

Many construction firms and contractors said that the surge in steel prices had hurt the effectiveness of the projects previously signed with their partners and caused losses to contractors.

Quang Trung, deputy director of Long Giang Construction Foundation JSC, said that the firm missed at least three projects due to the surge in steel prices, the local media reported.

Hoa Phat steel was priced at VND16.5-16.7 million per ton on April 22, while Southern steel sold for VND16.6-16.7 million per ton and the price of Pomina steel stood at VND16.9-17.2 million per ton.

The Vietnam Steel Association’s March report showed that the price of steel would continue to rise until the third quarter of 2021 due to the supply shortage from China and India. The association also said that while the domestic supply was not short, the steel price surge was a result of the high price of materials that increased in line with global prices.

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