Introduction to Vietnam's Anti-Dumping Measures
In a bid to safeguard its domestic steel industry, the Ministry of Industry and Trade (MOIT) of Vietnam has decided to impose provisional anti-dumping duties on coated steel products originating from China and South Korea. This decision, announced under Decision No. 914/QĐ-BCT dated April 1, 2025, aims to address the negative impact caused by what is believed to be the dumping of these products at unfairly low prices, undermining local producers. Anti-dumping measures are often introduced to counteract such practices, which can harm domestic industries by allowing foreign competitors to sell goods below market value.
The decision to apply provisional duties comes after a detailed investigation into the imports of coated steel from both countries. The MOIT’s decision, though provisional, is a crucial step toward ensuring fair competition in the Vietnamese market.
Details of the Provisional Duty Rates
Under the new measures, Vietnam has applied varying anti-dumping duty rates for different companies and exporters. For Chinese exporters, the highest duty rate stands at 37.13%, which applies to major companies like Baosteel Zhanjiang Iron & Steel Co., Ltd. and affiliated companies. In contrast, the duty for South Korean products is lower, at 15.67%, although the well-known company Hyundai Steel Company faces a slightly reduced rate of 13.7%.
Interestingly, not all companies will be subject to these hefty duties. Certain companies from both China and South Korea have been granted exemptions due to their minimal impact on the domestic market. These exemptions apply to companies such as Boxing Hengrui New Material Co., Ltd. and Yieh Phui (China) Technomaterial Co., Ltd. from China, as well as POSCO, KG Dongbu Steel, and Dongkuk Coated Metal from South Korea. These companies are granted a zero percent duty, signaling that their business practices were found to be less harmful to the local industry.
The Surge in Imports: A Cause for Concern
Vietnam’s steel industry has been facing increasing pressure from imports, particularly from China and South Korea. According to customs data, imports of coated steel have skyrocketed, reaching a massive 454,000 metric tons in the 12 months leading up to March 2024. This marks an alarming 91% year-on-year increase. Even more troubling, the period from July to March 2024 saw an additional 20% increase in imports from these countries, totaling about 382,000 metric tons in just nine months. This rapid rise in imports has been a cause of significant concern for Vietnam’s domestic steel producers, who argue that these imports are underpriced and harming their ability to compete.
The Vietnamese government has responded to this sharp increase with the application of provisional anti-dumping duties. These measures are meant to help control the influx of cheap imports and prevent further harm to the local steel industry, which could lead to job losses and diminished production capacity.
Key Features of the Anti-Dumping Investigation
The investigation leading up to these provisional duties was comprehensive and collaborative. The Ministry of Industry and Trade worked alongside other relevant authorities to assess the extent to which alleged dumping by Chinese and South Korean exporters was negatively impacting the local industry. This included the evaluation of prices, the volume of imports, and the general market conditions for coated steel in Vietnam.
During the investigation, the Ministry also evaluated the potential damage to the local industry. The conclusion was clear: without intervention, the increasing flow of underpriced coated steel could seriously harm domestic producers. In light of these findings, the Ministry decided to impose provisional duties as a temporary but necessary solution to mitigate this damage while further investigations continue.
Duration of the Provisional Duties
The provisional anti-dumping duties will remain in effect for 120 days starting from April 1, 2025. However, the Vietnamese government retains the authority to extend, amend, or revoke these duties based on the ongoing investigation and the results of further consultations. The Ministry of Industry and Trade is committed to ensuring that the final determination reflects the reality of the market situation and provides a fair and sustainable outcome for both foreign exporters and local industries.
The Exemptions: Who Benefits from Zero Percent Duties?
Certain companies, both in China and South Korea, have been granted exemptions from the provisional anti-dumping duties. These companies are considered to have a minimal impact on the local market or are not involved in practices that are detrimental to the Vietnamese steel industry. The following companies are exempt from the duties:
1. China:
o Boxing Hengrui New Material Co., Ltd.
o Yieh Phui (China) Technomaterial Co., Ltd.
2. South Korea:
o POSCO
o KG Dongbu Steel
o Dongkuk Coated Metal
These companies are granted a zero percent duty on their coated steel exports to Vietnam, allowing them to continue their trade with fewer restrictions compared to other exporters from the same countries.
Impact on the Local Industry and Future Developments
The provisional anti-dumping duties are expected to provide a short-term relief to the Vietnamese steel industry by curbing the surge in imports and allowing local manufacturers to regain some of their lost market share. However, the Ministry of Industry and Trade’s investigation will continue to monitor the situation closely. The findings will ultimately inform whether permanent measures are needed to ensure a level playing field in the market.
As Vietnam continues to navigate these challenges, it remains committed to safeguarding its industries from unfair competition, which could undermine the broader economic landscape. If the investigation reveals that the dumping practices persist or expand, it is likely that the provisional duties could be extended or even raised.
Key Takeaways
• Provisional Anti-Dumping Duties: Vietnam has imposed provisional anti-dumping duties on coated steel products from China and South Korea, with rates ranging from 37.13% to 15.67%.
• Company Exemptions: Some companies, including Boxing Hengrui New Material and POSCO, are exempt from these duties and will continue their trade with zero percent duties.
• Investigation Outcome: The duties will remain in effect for 120 days, with the possibility of extension, amendment, or revocation based on further investigation.
• Surge in Imports: Imports of coated steel from these countries have surged significantly, reaching a 91% increase year-on-year, prompting the need for anti-dumping measures.
• Impact on Domestic Industry: The Vietnamese government is acting to prevent harm to the local steel industry, which has been undercut by cheaper imports.
• Ongoing Inspections: The Ministry will continue to inspect foreign producers and domestic importers as part of the investigation process.
• Final Decision Pending: The investigation will determine whether the provisional duties should be extended or made permanent to protect the domestic industry in the long term.
This move by Vietnam reflects its commitment to fair trade practices and the protection of local industries from foreign competition that does not adhere to market fairness.
