[SMM Hot Topic] Vietnam Initiates Anti-Dumping Investigation on Chinese HRC: What Is the Logic Behind It?

• Background
• On March 19, 2024, two major Vietnamese steel companies, Hoa Phat and Formosa Ha Tinh Steel Corporation, filed an anti-dumping investigation application against HRC originating from China and India.

On April 10, 2024

• , according to the Vietnamese Ministry of Industry and Trade, the application for an anti-dumping investigation on HRC imported from China has been received. However, after preliminary evaluation, the evidence in the application was deemed insufficient. The Ministry of Industry and Trade has issued letters requesting relevant enterprises to further correct and supplement the materials. The results of the application review will be communicated to all parties as per regulations.On May 31, 2024

, the Trade Remedies Authority of Vietnam under the Ministry of Industry and Trade announced that it had received the complete supplementary materials from the applicants.

• On June 14, 2024, the Trade Remedies Authority of Vietnam announced that representatives of the domestic industry in Vietnam had filed an anti-dumping investigation application against HRC originating from China and India on March 19, 2024. The Trade Remedies Authority officially accepted the application on June 14, 2024, and the Ministry of Industry and Trade will decide whether to initiate a case within 45 days from the date of acceptance.

On July 29, 2024

• , the Trade Remedies Authority of Vietnam announced the official initiation of an anti-dumping investigation on HRC originating from China and India.On February 21, 2025

, the Vietnamese Ministry of Industry and Trade issued Decision No. 460/QD-BCT, imposing provisional anti-dumping duties on certain hot-rolled steel products originating from India and China. The document stated that the decision would be implemented for China but temporarily not for India. Accordingly, the provisional anti-dumping duty rates applicable to the investigated Chinese products range from 19.38% to 27.83%.

• The effective date is 15 days after the announcement (March 7, 2025).The product types and data involved in Vietnam's anti-dumping case against China are as follows: in 2024, the total volume of the products involved exported to Vietnam was 9.2825 million mt.

Table 1 - Products Affected by Vietnam's Anti-Dumping Investigation on Chinese HRC and Total Export Volume to Vietnam in 2024 (10,000 mt)

HRC accounted for 64.5% of the total steel exports to Vietnam.According to China's General Administration of Customs, Vietnam became China's largest steel export destination for the first time in 2023. In 2024, China's total steel exports to Vietnam reached 12.6307 million mt, up 36.56% YoY, accounting for 11.41% of China's total steel exports.Specifically, for various HRC products, the total export volume of medium and wide steel strips, hot-rolled thin plates, and hot-rolled thin wide steel strips to Vietnam in 2024 was 8.1414 million mt, accounting for 64.5% of China's total steel exports.

Table 2 - Quantity of Various Steel Products Exported from China to Vietnam in 2024 (10,000 mt)

Over the past three years, the export volume of various HRC products from China to Vietnam has increased annually, with an overall growth rate of 97.4% in 2023.

Figure 1 - Export Trends of Major HRC Products from China Over the Past Three Years

Vietnam's Steel Import Situation: China Has Long Been Vietnam's Largest Steel Import Source

According to data from the General Statistics Office of Vietnam, the main countries and regions for Vietnam's steel imports in 2024 were China, Japan, South Korea, ASEAN, India, Australia, the EU, and the US. In recent years, China has consistently ranked first in Vietnam's steel import volume. However, the growth rate significantly increased starting in 2023, with a growth rate exceeding 62% that year, compared to only 16% in 2022. From January to November 2024, Vietnam's total steel imports from China reached 11.0383 million mt, maintaining a high growth rate of 46%.

                                      Table 3 - Vietnam's Steel Import Data Over the Past Three Years     

                                                                      Figure 2 - Vietnam's Steel Import Trends Over the Past Three Years

Vietnam's Steel Export Situation: The US Has Long Been Vietnam's Largest Steel Export Destination

14. According to data from the General Statistics Office of Vietnam, apart from ASEAN and the EU regions, the US has been a major destination for Vietnam's steel exports in recent years. From January to November 2024, Vietnam exported 1.646 million mt of steel to the US, up over 50% YoY.

Following the US were India, South Korea, Australia, Japan, and China. In 2023, both China's steel exports to Vietnam and imports from Vietnam experienced significant changes, with one seeing a sharp increase in growth rate and the other a sharp decline.                                      Table 4 - Vietnam's Steel Export Data Over the Past Three Years                                                                            Figure 3 - Vietnam's Steel Export Trends Over the Past Three Years     

 Reasons for Vietnam's Anti-Dumping Investigation Against China

Internal Factors:

Since 2018, the Vietnamese Ministry of Industry and Trade has successively launched anti-dumping investigations on cold-rolled steel, galvanized steel, H-beams, and other products imported from China. In 2023, the scope of investigations was further expanded to include color-coated steel sheets.

14. The core issue lies in Vietnam's belief that Chinese steel benefits from "government subsidies causing price distortions," thereby squeezing the profits of local steel enterprises. Meanwhile, Hoa Phat Group in Vietnam plans to commission a rolling line with an annual capacity of 5.6 million mt in Q1 2025, which will reduce its reliance on Chinese resources.

External Factors:As a net importer of steel, Vietnam's steel import YoY growth rate in 2024 significantly outpaced its export YoY growth rate, further widening the trade deficit. On February 10, 2025, Trump announced a uniform 25% tariff on all steel and aluminum products imported into the US, canceling previous exemptions and quotas for certain countries.Since the US is one of Vietnam's major steel export destinations,

Vietnam's total steel exports in 2024 were 12.58 million mt, with steel exports to the US accounting for approximately 13% of Vietnam's total steel exports from January to November.

Vietnam's high dependence on the US market means that the US's indiscriminate tariff policy has exerted certain pressure on Vietnam's steel exports.

Impact of Vietnam's Anti-Dumping Investigation Against China

• Short-Term Impact Is Unavoidable

Currently, the price spread between Southeast Asian import prices and ex-factory prices is around $10/mt. The provisional anti-dumping duty of 19.38%-27.83% will increase Vietnam's import costs by $94-130/mt (based on current import prices), making imports essentially uncompetitive. Previously, the tariff implementation was expected in March, but the earlier-than-expected implementation may lead to risks of canceled orders or additional costs for goods that fail to depart in time, thereby exerting pressure on domestic steel mills to redirect pig iron or shift to domestic trade sales.Based on the specifications and trade modes involved in the anti-dumping case, approximately 90% of HRC export volumes fall within the scope of Vietnam's anti-dumping case, with an annual total volume of about 7.32 million mt/year, equivalent to 600,000 mt/month. However, according to SMM, the Vietnamese authorities initially announced that provisional tariffs would be introduced in November 2024. At that time, some domestic customers adjusted their sales channels to mitigate risks, leading to a decline in steel exports to Vietnam to over 400,000 mt in November and December after a surge in September and October.In January, the rush to export remained evident, with HRC exports to Vietnam likely rebounding to 500,000 mt. Affected by the Chinese New Year holiday, February exports may pull back to 300,000-350,000 mt, while March exports of HRC to Vietnam are expected to drop below 300,000 mt.

 Figure 4 - Monthly Total Steel Export Volume from China to Vietnam Over the Past Three Years (Forecast)Medium and Long-Term Impact Remains to Be SeenIn the medium and long term, Hoa Phat Group's Dung Quat 2 plant, under planning, is expected to be completed in September 2026, with an annual capacity of 5.6 million mt. However, once the first blast furnace is completed in Q1 2025, it will be able to produce HRC. By 2025, this project is expected to produce over 2 million mt of HRC. On December 21, 2024, Malaysia's Eastern Steel Group commissioned a 1,450mm rolling line with an annual designed capacity of 3.5 million mt. Indonesia's Dexin commissioned a 1,780mm rolling line in September 2024, with an annual designed capacity of 4.5 million mt. 

• Thus, the phased reduction in domestic supply in Vietnam will be offset by the additional HRC capacity in Southeast Asia. Moreover, ASEAN countries enjoy zero tariffs, so the impact on local steel supply in Vietnam post-anti-dumping is relatively limited. For China, compared to the average monthly export volume in 2024, the monthly return volume of HRC may be 200,000-300,000 mt, which will impact the domestic HRC supply-demand pattern. Export participants should actively explore other markets, particularly the Middle East, which has relatively low per capita crude steel consumption and significant growth potential.
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