Entering 2026, the Vietnamese steel industry is facing positive signs of a turnaround. Amidst volatile international trade, the shift in focus towards the domestic market and mastery of upstream control are becoming the guiding principles for sustainable growth for leading companies in the industry. The prospects for the steel sector are receiving more attention than ever before.
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Steel Industry in Q2 2026: Recovery Accelerates, Steel Prices Enter a New Cycle
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Steel industry outlook: Factors determining recovery
The outlook for the steel industry will depend on whether businesses can seize and capitalize on new opportunities in the market.
Data from the Vietnam Steel Association (VSA) shows a strong correlation between supply and demand, with production and consumption in sync.
The resurgence of real demand: With sales volume growth reaching 6.8% in the first 10 months of the year, the market is showing good absorption capacity. The main driving force comes from the resurgence of the residential real estate segment and the aggressive disbursement progress in key infrastructure projects.
The pivot strategy: Faced with protectionist barriers in export markets, businesses have proactively implemented a “defensive” strategy by consolidating their domestic market share, making the domestic market their number one target market to maintain stable cash flow.
Selling Price and Profit Margin: Positive Recovery Outlook
After a period of pressure from raw material costs and weak demand, the profit structure of the steel industry is improving significantly.
Value recovery: The growth momentum of domestic demand has created room for businesses to readjust their selling prices.
Cost optimization: The stability of iron ore and coking coal input prices, combined with improved plant operating efficiency, is projected to help expand the industry’s gross margin in 2026.
Hot-rolled steel (HRC): A driving force behind upstream growth.
HRC is not just an intermediate product, but has become a key component in increasing the added value of Vietnam’s steel industry.
Breakthrough growth: This segment recorded the most impressive growth (ranging from 7-30%), reflecting the enormous demand from downstream industries such as galvanized steel and steel pipes.
Increased self-reliance: Focusing on HRC production helps large corporations reduce their dependence on imported goods, while also meeting stringent rules of origin requirements when exporting to demanding markets.
Strengthening production capacity and technological transformation.
The race to scale up is entering a decisive phase with the emergence of large-scale production complexes.
Scaling up: Strategic projects (such as Dung Quat 2), once operational, will create a turning point in total capacity, helping Vietnam solidify its position as a regional steel production hub.
Standardization: Production capacity is strengthened not only in quantity but also in quality, meeting green standards and reducing emissions in preparation for international carbon tax pathways.
Risk Management and Competitive Challenges
Despite the bright overall picture, businesses still need to remain cautious about external variables:
Intense competitive pressure: The surplus of steel from neighboring markets, especially China, remains a direct threat to domestic market share if timely trade protection measures are not implemented.
Non-tariff barriers: Policies such as the EU’s CBAM or anti-dumping cases require businesses to improve their legal capacity and increase transparency in their production processes.
According to experts, 2026 will be a year of “purification” and breakthrough. Businesses that possess a closed-loop value chain, control the HRC segment, and have a solid domestic distribution network will be the driving force behind the industry’s recovery.
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3. Chemicals for Hot-Dip Galvanizing (HDG)
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