Against the backdrop of global economic turbulence, the U.S. government, under President Donald Trump, imposed a 25% tariff on all imported aluminum and steel products starting March 12, marking a significant turning point in American trade policy.
The sudden imposition of the aforementioned tariffs has dealt a heavy blow to multiple aluminum and steel exporting countries, including Vietnam. Steel and aluminum enterprises in Vietnam, such as the Hoa Phat Steel Plant and galvanized steel plate production lines in Hoa Phat and Nam Kinh, now face difficult choices.
Many perspectives suggest that Vietnam's share of the aluminum and steel market exported to the U.S. is relatively small, and since 2018, the Vietnamese steel industry has grown accustomed to a 25% tariff. Therefore, the current tariff hike may have minimal impact on enterprises. However, for some aluminum product exporters, the effects will be more pronounced, as they previously only faced a 10% tariff.
In fact, the "storm" of U.S. tariff hikes may not yet be over, and businesses should not take it lightly. According to data from the Vietnam Steel Association (VSA), Vietnam's steel exports reached approximately 12.62 million tons in 2024, marking a year-on-year increase of 13.47%, with total exports amounting to $9.08 billion, up 8.78% compared to the previous year. Among these, the U.S. ranks as Vietnam's third-largest steel export market, accounting for 13%, trailing only the Association of Southeast Asian Nations (ASEAN) at 26% and the European Union (EU) at 23%.
According to data from the Vietnam Steel Association (VSA), Vietnam's steel exports in 2024 amounted to approximately 12.62 million tons, marking a year-on-year increase of 13.47%. The total export value reached $9.08 billion, up 8.78% year-on-year. Among these, the United States is Vietnam's third-largest steel export market, accounting for 13%, following ASEAN (26%) and the European Union (23%).
Although Vietnam's steel exports to the United States account for only 13% of the country's total steel exports, the US market holds significant strategic importance for Vietnamese steel plate and steel production enterprises. The reason is that the United States relies on imports for 12% to 15% of its steel demand, which amounts to approximately 20 to 25 million tons per year. This provides a potential market for Vietnam, provided that companies can successfully overcome trade barriers.
However, under the new tariff policy, the originally meager profit margins of Vietnamese companies will be further compressed, and they may even face the risk of losses if they cannot adjust their business strategies in a timely manner. The cost of Vietnamese aluminum and steel products entering the US market will be significantly higher than products that are protected by local policies, or products from other countries that have advantages in logistics and lower costs due to optimized production technology. This will greatly reduce the competitiveness of Vietnamese products.
Moreover, due to the obstruction of global market exports, it may trigger a 'domino effect', forcing major steel exporting countries such as Canada, Mexico, Brazil, and South Korea to seek new markets to digest excess capacity. This will further exacerbate the disadvantage of Vietnam's steel industry, and if companies cannot quickly develop effective competitive strategies, they will face greater challenges.
In addition, due to Vietnam's close proximity to China, the world's largest steel producer, it is easy to become an import destination for cheap steel. The consequences could lead to a significant drop in domestic steel prices, difficulties in business operations, and even the risk of other countries initiating anti-dumping lawsuits against Vietnamese steel products.
Therefore, in order to effectively respond to the changes brought about by the US tariff policy, Vietnamese galvanized steel sheet and steel production enterprises need to timely understand and grasp market dynamics in order to formulate appropriate business strategies. Enterprises should continue to increase innovation investment, improve technological level and product quality, while optimizing costs to minimize the negative impact of tariffs.
It is worth mentioning that absolute prevention of "forged origin" issues is one of the strictest aspects of the United States' inspection of imported goods.
In addition, the government should formulate proactive support policies to enhance the competitiveness of the steel industry, assist enterprises in adjusting their export direction, and establish more efficient sales channels; Promote the implementation of various free trade agreements to reduce pressure from other countries' trade protection measures; At the same time, assist enterprises in finding strategic trading partners to help the Vietnamese steel industry achieve sustainable development.
