Will the domestic steel market improve in the second half of the year?

The market has many optimistic signals.

According to the report of the Vietnam Steel Association , the production and consumption of finished steel products in Vietnam are showing positive signs. Data shows that in May 2025, finished steel production reached 2.79 million tons, up 8.0% over the same period last year; sales of all kinds of steel reached 2.88 million tons, up sharply by 13% over the same period in 2024.

Accumulated in the first 5 months of 2025, finished steel production reached 13 million tons, an increase of 9% over the same period in 2024; finished steel sales reached 13.22 million tons, an increase of 11% over the same period last year.

The domestic construction steel market continues to maintain a stable production and consumption rhythm, despite negative developments in the region and internationally. Production and sales of finished steel products increased thanks to domestic demand becoming the main driving force in the context of declining exports due to increased trade defense measures in many countries.

*The domestic steel market is expected to improve in the second half of the year. Illustrative photo*

MSc. Vu Thi Dao, Institute of Economics and Finance, Academy of Finance, Ministry of Finance, believes that the steel market has positive signals when production remains stable, domestic consumption is good and prices are expected to recover in the coming time.

As for Hoa Phat Group, from the end of 2025, the group's steel design capacity will reach 16 million tons/year, focusing mainly on hot-rolled steel coils and high-quality steel for the mechanical engineering industry. The supply from Hoa Phat will contribute to supplementing domestic steel output, stabilizing the market.

Price increase forecast is not strong but there is improvement

Regarding prices, according to Ms. Vu Thi Dao, the domestic steel market has been on a downward trend with the world market since 2022. Particularly for Hoa Phat steel, as of the end of June 2025, the price of CB240 rolled steel of Hoa Phat brand decreased in most brands by 250 - 310 VND/kg compared to the price at the end of May 2025. It can be seen that domestic steel prices remain low, while the prices of other construction materials have increased significantly compared to the beginning of 2025.

As of the end of June 2025, domestic steel prices remained low, while prices of other construction materials had increased significantly compared to the beginning of 2025.

For domestic steel prices, the beginning of the third quarter is usually the rainy season, construction activities are unlikely to have much breakthrough. Furthermore, although the real estate sector has shown signs of warming up, it has not really improved significantly. Steel consumption may continue to remain stable, construction steel prices will fluctuate in the range of 14 - 15 million VND/ton.

However, the trend will be more positive towards the end of the third quarter, especially with efforts to remove difficulties in the real estate sector and the promotion of public investment, when steel prices may have a more obvious recovery. It is expected that the increase in housing supply and public investment will be the key factors driving the growth of domestic steel output. Some projects are accelerating construction progress such as the North-South Expressway and Long Thanh Airport.

MSc. Vu Thi Dao said that with the Government promoting the disbursement of public investment capital as it is now, steel consumption will continue to improve in the coming time, compensating for the decline in the export sector. Promoting public investment projects will help support steel prices to some extent.

However, steel prices will not increase as sharply as other construction materials such as sand and stone due to abundant supply. Factories are also increasing production again. Meanwhile, construction activities of civil works and the real estate market, although gradually warming up, have not really exploded to pull steel prices up strongly.

The real estate market has not recovered as expected, the world economy is unstable and the difficulties in the new US tariff policy are the main reasons leading to the decrease in steel demand, causing steel prices to remain low in the first half of 2025.

The domestic steel market has recorded positive signals as production remains stable and domestic consumption is good. It is forecasted that the steel market may recover in the second half of 2025 when the demand for infrastructure construction as well as the real estate market is expected to be more positive.

Source: https://congthuong.vn/thi-truong-thep-noi-dia-se-khoi-sac-trong-nua-cuoi-nam-411526.html