Domestic stainless steel manufacturers have just sent a petition to the Prime Minister, leaders of the Ministry of Science and Technology, and leaders of the General Department of Standards – Metrology.

Specifically, stainless steel manufacturers stated in a letter to the prime minister dated 24 December 2022 that they were “shocked and outraged” to learn that Posco enterprise VST (Korea) and a few Vietnamese businesses had objected to the Ministry of Science and Technology’s decision to include GD1 and GD2 products in the National Standards.

Prior to that, in Mid-November 2022, at the Conference of Vietnamese Standards on Stainless Steel for Molding and Household Appliances organized by the Ministry of Science and Technology, businesses heard the conclusions of scientists after nearly a year of research on the quality and applicability of seri 200 in the Vietnamese market, specifically 2 products GD1 and GD2 about the suitability of these materials when they meet Vietnamese standards for stainless steel. It is expected that this decision will be finalized so that it can be put into effect as early as 2023.

This move of the Ministry of Science and Technology is gladly welcomed by stainless steel manufacturers, because it will end the arising and controversial issues since Circular 15/2019/TT-BKHCN promulgated the National Technical Regulations on stainless steel which is effective on 1 January 2020. Accordingly, seri 200 stainless steel products will not be circulated on the market from 1 January 2020 – when the National Technical Regulation on Stainless Steel (QCVN: 2019/BKHCN) comes into force.

At that time, 33 enterprises representing the majority of large stainless steel manufacturers in Vietnam agreed to sign a petition to review the content and application period of QCVN:2019/BKHCN. After that, the Ministry of Science and Technology issued a document to postpone the implementation date of QCVN: 2019/BKHCN till 31 December 2022 to find appropriate solutions.

Therefore, the opposition to the plan put forth by the Ministry of Science and Technology for processing two products—GD1 and GD2—for the Vietnam market by some enterprises—mostly commercial ones that trade Posco’s cold-rolled stainless steel products—causes concern among stainless steel manufacturers.

Representatives of 32 businesses explained the following in a letter to the prime minister: “This GD1&GD2 steel product has been standardized by a capable and competent organization, the Standards Institute – The Ministry of Science and Technology, according to the scientific method, researched and evaluated by an independent unit, the Center for Assessment of Material Damage – Institute of Materials Science – Vietnam Academy of Sciences. The mechanical qualities of these steels are significantly better than those of the Japanese SUS201 steel replica, as determined by scientific themes and assessed by scientific councils to demonstrate that this is stainless steel with anti-corrosion capabilities “.

Representatives of enterprises also said that GD1 & GD2 steel products are basically stainless steel according to international standards when there is chromium of more than 10.5% and Carbon of less than 1.2% (according to the definition of stainless steel in national and international standards).

“There has not been any document saying that this is a low-quality product”, the enterprises asserted, in contrast to the views of businesses that objected to setting standards for GD1&GD2 steel products.

According to preliminary statistics of enterprises named in the letter, the total domestic consumption of stainless steel in 2022 is about 381,000 tons, of which seri 200 stainless steel products have an output of about 104,000 tons, accounting for approximately 27.3%.

The whole amount of temporary imports for re-export, the production of items from major brands like Yong Jin, IKEA, and Wallmark, who contract mechanical manufacturers in Vietnam to process goods for their supply chain, are subtracted from the overall volume of domestic stainless steel consumption.

These types of steel are mainly used to manufacture household products such as hangers, light troughs, tables, chairs, stair railings, fodder troughs, household appliances, interior equipment furniture, shells of all kinds of machinery and equipment, components and spare part of many industries… in order to replace similar products using steel, galvanized steel with the advantages of acceptable anti-corrosion properties, easy to work with, good mechanical properties.

Businesses also reported that in addition to creating the aforementioned goods for local use, Vietnamese stainless steel producers have been exporting these goods to a variety of foreign countries, including the Netherlands, Germany, Turkey, Russia, China, India, Thailand, and even Korea.

In this situation, businesses signed a letter to the Prime Minister stating that consumers would be forced to use other steel products with higher prices if these types of steel disappeared from the Vietnamese market. This would result in excessive consumption of power and ability and could lead to financial losses for consumers.

The “personal letter” also raised a close concern for Vietnamese exporters that: “Vietnamese exporters will then have to operate outside of the global marketplace, and the greater risk is that finished goods and household goods made with this type of steel will be imported into the Vietnamese market and will compete completely with domestically produced goods in terms of price. This will hurt domestic mechanical production, causing many difficulties, especially in the context that domestic manufacturers are trying to survive after the Covid-19 pandemic.

Businesses are also concerned that Posco VST is the most advantageous party at that particular time.

[in the table]

Previously, on 30 November 2022, a number of enterprises, including Posco VST, had petitioned the Prime Minister and leaders of the Ministry of Science and Technology to reconsider the introduction of seri 200 stainless steel products in the TCVN Draft that stainless steel is a household appliance… These enterprises said that Posco VST is in the process of importing raw materials, and preparing to produce new steel to replace the low-end seri 200.

Source: Cong Thuong

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