3:26:35 PM | 7/8/2005
The Vietnamese Prime Minister Phan Van Khai has instructed the ministries of Trade, Finance and Industry to jointly inspect the price increases of three State-owned corporations, including the Vietnam Coal Corp. (Vinacoal), the Vietnam Steel Corp. (VSC) and the Vietnam Cement Corp. (VNCC).
The instruction, which was released in official letter No 1521/VPCP, said any price hike would have a knock-on effect to the economy as coal, steel and cement were the country’s key economic input factors.
The Prime Minister has also guided enterprises to find solutions to reduce production costs and stabilize prices of the three above-mentioned products.
Vinacoal asked the Government to raise the price of coal on March 14 while VSC and VNCC requested a price hike early this month.
Vinacoal said that raising the coal price would help it compensate for increased costs and the need for more investment in coal exploitation, while VSC and VNCC attributed the requests to fluctuations of input materials prices in the world market. They said that increases in selling prices would help them avoid losses.
Meanwhile, the Government wanted three ministries to check proposals in an effort to find suitable solutions. The Government recently refused a Vinacoal plan to hike prices and it has threatened to interfere in the construction steel market if steel prices go up.
In an attempt to keep prices stable, VNCC has stockpiled 1.5 million tons of cement and has asked its subsidiaries to operate at full throttle.
Coal prices stand at VND566,000 per ton for lump coal and VND266,000 per ton for dust coal, prices of rolled steel and steel bars of VSC are VND7.8 million and VND8 million per ton, respectively.
The retail price of VNCC’s cement, which accounts for more than 50 per cent of the local market share, ranges from VND730,000 to VND770,000 per ton.
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