Hoa Phat to restart Dung Quat blast furnace
Vietnam’s Hoa Phat Group, one of the leading steel manufacturers in the country, has announced that it will restart the banked No. 3 blast furnace at its Dung Quat plant in early April. The confirmation was made during Kallanish's tour of the plant on Wednesday. The furnace is one of four at the plant, each with a capacity of 1 million tonnes per year. Currently, two blast furnaces are in production, while two are banked, and the restart of the third furnace could potentially leave only one furnace banked. Hoa Phat had to idle two blast furnaces in late 2022 due to weak market demand. Vietnam's steel industry has been constrained by a tight credit environment, a crackdown on corruption, and high real estate prices.
Hoa Phat sources have also revealed that the three longs rolling lines at the plant are currently out of operation but are expected to resume operation soon after the completion of maintenance work. However, this information could not be confirmed by other sources at the plant.
The company's HRC mill, which thin-casts slabs with thicknesses of around 70-90mm and feeds them directly into the hot strip mill, is not operating at full capacity. This means that the sale of merchant slab does not make sense for the plant.
The Dung Quat plant has a crude steel capacity of 5.6 million tonnes per year, HRC capacity of 3.5 million tonnes per year, and 2.6 million tonnes per year of construction longs capacity.
While Hoa Phat's decision to restart the banked furnace is expected to increase steel output, it is unclear where the additional output will be sold, given that the HRC markets in the region are already well supplied, and new regional HRC mills, such as the one at Eastern Steel in Malaysia, are coming on-stream this year. Some of the increased HRC output will likely have to be exported, as the domestic markets are becoming saturated.
Despite these challenges, Hoa Phat remains one of the top steelmakers in Vietnam, with a wide range of products and services that include steel pipes, galvanized steel, color-coated steel, and more.
Other top steelmakers in Vietnam include Formosa Ha Tinh Steel Corp, which operates one of the largest steel plants in Southeast Asia, and Hoa Sen Group, which specializes in the production of coated steel sheets and is known for its high-quality products and competitive pricing.