Residential construction is one of the most reliable drivers of steel consumption in Asia, according to speakers at the Kallanish Asia Steel Markets conference in Ho Chi Minh City this week.

Positive prospects prevail for Vietnam, China and India, speakers said, describing the climate for investment in steel in their respective countries. “Housing was the main driving force in 2018,” Jiang Li of Baosteel stated very clearly for China. 

She highlighted some notable changes in progress for the country’s steel industry. Chinese manufacturing costs have risen, so the country is switching resources to other countries such as Vietnam, India, or Indonesia, a trend that began even before the trade conflict, Li said. Against that, residential construction will naturally remain a domestic domain.

Similar conditions apply to the steel market in Vietnam, according to Ha Trinh Nguyen, steel analyst of Viet Dragon Securities Corporation. Domestic demand is the main force, much more than exporting, she emphasised (see separate article). “The government has shown its willingness to spend on construction and infrastructure,” she stated, citing high demand from many newly-married couples as well as projects for shopping centres.

A stream of investment intended to be spread more widely than just in the construction of living space is that in ‘smart cities’, highlighted by Amit Chandaliya of Essar Steel. The Indian government has lined up $22 billion for that purpose, he said.  He also presented a road map for the country’s steelmakers, in cooperation with the government, to raise the country’s steel production from the current 122 million tonnes/year to 300m t/y tonnes by 2031.