Vietnamese steelmakers have proposed cutting the tax on steel ingot exports to 10 per cent from current 20 per cent in order to extricate difficulties for the steelmaking industry, VietNamNet reported.
The enterprises said domestic steel consumption is plummeting while the tax on steel ingot exports is 20 per cent and steel ingot prices on the world market are sharply falling so they can not export, causing bad financial problem.
The Van Loi Cast Iron & Steel Company reported 40,000 tons of ingots in stockpile and it has suspended production in ten days.
Meanwhile, the Dinh Vu Steel Company said its stockpiled steel ingot is 15,000 tons and production is sharply reducing while the company still has to pay high interest rate for banking loans, salaries for workers and electricity bill.
Steel makers including Van Loi, Dinh Vu, Hung Tai and Thep Viet have sent a document to relevant authorities, proposing that ingot export tax should be lowered, or the government buy their volume of stockpiled steel ingots so that they will have capital returns for production.
According to the Vietnam Steel Association (VSA), August’s steel consumption was estimated at 120,000 tons, equaling a half of July, becoming the month with the lowest steel purchasing power ever before.
Transactions are still gloomy although steel prices have been down three times in August.
At present, retailed steel price is averaging VND18.5 million-VND18.6 million per ton.
According to the General Statistics Office (GSO), 120,000 tons of steel ingots were imported into Vietnam in August with an average price of US$850/ton, a slight increase against July.
The re-exports of steel and steel ingots stopped last month as the export tax remained 20 per cent.
In the first seven months this year, steel enterprises re-exported US$1.5 billion worth of steel products, the association said. (VietNamNet, Youth)
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