Hoa Phat Group expects exports to remain high in the first quarter of 2024

DNHN - Hoa Phat Group's steel exports are forecasted to remain high in the 1st quarter of 2024 especially in the EU, thanks to its price competitiveness and the trend of foreign distributors increasing their inventory of competitively priced imported goods.

According to the latest data, Hoa Phat Group Joint Stock Company (stock code HPG - HoSE) recorded positive growth in steel consumption in the fourth quarter of 2023. Consumption in October 2023 increased by 8% compared to September 2023 and continued to rise by 14% in November 2023 compared to the previous month. Notably, Hoa Phat Group has made significant improvements in the EU market, with steel exports to Italy increasing more than eightfold compared to the same period in 2022. In addition, Hoa Phat has also expanded its export market to new countries such as Belgium and Portugal.

In the EU market, after the third quarter of 2023, steel producers had to temporarily halt production or reduce output to compete with cheap steel imported from China and some Asian countries, while demand remained low. In the fourth quarter of 2023, some factories in the EU continued to maintain low capacity utilisation to balance supply and demand in the market and optimise operations.

KB Securities Vietnam (KBSV) stated that Hoa Phat Group's export channel output will continue to remain high in the first quarter of 2024, especially in the EU, due to its price competitiveness and the trend of foreign distributors increasing their inventory of competitively priced imported goods.

KBSV also assessed that after a sharp increase in the fourth quarter of 2023, input material prices are expected to remain stable in the first quarter of 2024, and steel prices in the US and EU markets will also remain at current levels after bottoming out in the third quarter of 2023.

According to some financial institutions, Hoa Phat's recent expansion of its export channel could be in preparation for the HRC product market from the Dung Quat 2 Project, which is expected to launch in the first quarter of 2025 and operate at full capacity from 2027.

P.V