Not long after the Ministry of Industry and Trade launched an investigation into steel billet imports following a request of four major producers, many other companies are worried that it may lead to high punitive taxes on imports and eventually hurt their business.
Unlike the four producers that called for the probe against cheap imports, other steelmakers said they depend on imported semi-finished products and increases in input costs will squeeze profit margin.
This second group, including Australian-owned SSE and local Pomina, therefore urged the government to call off the investigation and not to impose a high duty on steel billets.
Le Minh Hai, CEO of Vietnam Germany Steel JSC, a producer in the northern province of Vinh Phuc with an annual output of 350,000 tons, said given billets make up for 85 percent of input costs, higher taxes will lead to higher prices.
Any safeguard measure against imported steel billets will seriously cause negative impacts on Vietnam's steel industry and consumers, news website Saigon Times Online quoted Hai as saying.
Last year Hoa Phat, Southern Steel, Thai Nguyen, and Vietnam-Italy Steel, which account for nearly 40 percent of Vietnam's steel billet output, claimed that increasing imports have hit local producers and demanded an investigation.
While Vietnam's steel billet imports saw a three fold increase from 2014 to 1.5 million tons last year, the latest figure was much lower than those of 2008 and 2009 when nearly 2.4 million tons were imported each year, industry data showed.
The trade ministry's investigation will wrap up in six months at the earliest.