Brian Jeffrey
Following a brief downturn, the market quickly recovered, prompting discussions regarding the enduring effects of Trump’s policies on Vietnam’s steel industry.
On February 10, shares of Hoa Phat Group (HPG) and other steel firms saw a steep decline. HPG’s stock fell by nearly 4.7%, resulting in a loss exceeding $80 million for Hoa Phat Group chairman, Tran Dinh Long, which brought his total assets to roughly $1.68 billion.
The family fortune of Tran Dinh Long decreased by about $112 million following the announcement of a 25% tariff on all steel and aluminum imports by former U.S. President Donald Trump, affecting imports from Vietnam as well. Trump officially signed this order on February 11, Vietnam time.
Other steel shares also faced significant declines on February 10, with Hoa Sen Group (HSG) decreasing by 4.52% and Nam Kim Steel dropping 3.6%.
This tariff announcement immediately impacted investor confidence; however, experts predict that the long-term effects might not be as detrimental as first thought.
As stated by SSI Securities, Trump signed a measure to increase steel and aluminum import tariffs to a flat 25%, eliminating exemptions for specific countries. This move extends the Section 232 tariffs put in place in 2018, which initially provided exemptions to nations like Canada, Mexico, Brazil, South Korea, and the UK.
The new directive keeps Section 232 tariffs intact, but all exemptions will be removed, with the law expected to take effect on March 4.
For Vietnam, the 25% tariff on steel imports to the U.S. has been in place since 2018 under Section 232, suggesting that this latest tariff hike won’t significantly impact Vietnamese steel exports.
SSI Securities argues that the new policy will minimally affect Vietnam’s steel export sector, and it may even offer some advantages by enforcing a uniform tariff across all countries, lessening the competitive gap for Vietnam.
Vietnam’s steel exports to affected nations like Mexico and Canada have been quite minor, as these countries were not recognized among Vietnam’s top ten steel export destinations as of December 2024, according to the Vietnam Steel Association (VSA).
Nonetheless, the full implications of the policy are still unclear due to the complexities of the existing tariff framework. Various trade obstacles, including countervailing duties (CVD) and anti-dumping (AD) taxes, are currently under examination for potential anti-dumping irregularities.
The U.S. has recently published preliminary results concerning anti-corrosion steel imports from Vietnam, assigning low CVD rates of about 0.13% for Hoa Sen Group (HSG) and 0% for Ton Dong A (GDA). Further AD tax evaluations are anticipated shortly.
On February 11, HPG shares saw a bounce back of nearly 2.8%, helping the family of Tran Dinh Long recover more than half of their earlier losses.
However, HSG and GDA stocks continued to experience a downturn, losing 0.9% and 1.24%, respectively.
For the steel industry, SSI Securities foresees an optimistic outlook for 2025, spurred by a revival in domestic demand, heightened public spending, and an upturn in the real estate sector. The firm also predicts the imposition of anti-dumping duties on hot-rolled coil (HRC) steel from China and India.
Revenue growth is anticipated for Hoa Phat Group as its Dung Quat 2 plant commences operations.
In 2024, Hoa Phat reported a 17% increase in revenue, surpassing $5.6 billion, while net profits soared by 77%, exceeding $480 million.
On February 11, the stock market reflected a positive trend with the VN-Index rising by 5.2 points to reach 1,268.45. The HNX-Index increased by 0.9 points to 228.87, and the UPCoM-Index saw a slight uptick of 0.12 points, landing at 96.75. Overall liquidity across the three exchanges approached $620 million.
Manh Ha
