Steel market 2M2026 – Consumption volume shows divergence, selling prices have recorded a recovery
• Differentiated consumption volume: Construction steel and HRC recorded strong growth (cumulative increase over the first two months of 39% and 214% YoY, respectively), supported by domestic demand and additional capacity from Dung Quat 2 (HPG’s HRC alone rose by 82% YoY). In contrast, the galvanized steel segment declined (-22% YoY, mainly due to a sharp 45% drop in exports), while steel pipes remain flat.• Selling prices have recovered: Domestic steel prices rebounded, led by construction steel (+10% YTD) and rolled steel (slightly increasing in the second half of March). The upward trend in Q1 2026 was mainly driven by cost-push factors, including higher coke prices (+3% YTD), iron ore (+4% YTD), and elevated freight rates due to oil prices.
• Expect clearer recovery from Q2: The steel industry is expected to recover more noticeably from Q2, supported by two main drivers: (1) potential tariffs following the anti-circumvention investigation into trade remedies on wide-gauge steel imported from China, and (2) the peak construction season, which may allow for higher selling prices to offset costs and improve profit margins.
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