05:59 (GMT +7) - Tuesday 23/04/2019

BUSINESS SPOTLIGHT

Hoa Sen Group's FY 2017-2018 export revenue up 27%

Released at: 07:52, 19/03/2019 BUSINESS SPOTLIGHT

Hoa Sen Group's FY 2017-2018 export revenue up 27%

A ceremony marking shipment of 15,000 tons of steel from Hoa Sen Group to the UK, Germany, and Italy on March 16 (Photo: Hoa Sen Group)

Group leads the way in the export of galvanized steel.

by VET reporter

The Hoa Sen Group’s export revenue exceeded $538 million in the 2017-2018 fiscal year, up 27 per cent against the previous year.

According to the Vietnam Steel Association, Vietnam exported 1.75 million tons of galvanized steel last year, of which more than 639,000 tons came from the Hoa Sen Group, accounting for nearly 37 per cent of the total and representing the highest share among exporters.

The group exports an average of 50,000 - 60,000 tons of finished steel products a month to more than 75 countries and territories, in particular to fastidious markets that require strict quality standards and precise delivery times be met, such as the US, Europe, and the Middle East.

An official from Hoa Sen said it now quite difficult to expand export markets as Vietnam must deal with trade defense lawsuits, especially in the steel industry. The group, however, has successfully maintained its key export markets over recent years, he added.

On March 13, 2019, the Malaysian Ministry of International Trade and Industry (MITI) issued a final decision on an anti-dumping lawsuit on imported galvanized steel products from Vietnam and China. Anti-dumping tariffs on products from Hoa Sen are zero per cent, with a dumping margin of -3.34 per cent. Hoa Sen was the only enterprise from Vietnam to be exempted from tariffs on its iron and steel roll exports to Malaysia.

On August 18, 2017, a WTO Panel dismissed self-defense measures adopted by Indonesia and asked the country to revoke trade safeguard measures before March 27, 2019, thus offering an opportunity for the Hoa Sen Group and other steel exporters from Vietnam.

The Australian Anti-Dumping Committee (ADC), meanwhile, announced the final conclusion of an investigation on August 16, 2017, finding that the Hoa Sen Group did not dump and that is was not accused of benefiting from illegal government subsidies.

Since the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) came into effect in the first seven of the eleven member countries - Australia, Canada, Japan, New Zealand, Mexico, Singapore, and Vietnam - the future for Vietnamese steel exporters has become more optimistic.

On the first day of the recent lunar new year, the Hoa Sen Group signed a contract to export 4,300 tons of steel worth about $3.7 million to Mexico; a good sign for a successful 2019.

Earlier, on January 10, it exported 17,000 tons of steel worth more than $14 million to the US; the first batch of steel products exported to the country this year.

The export of 15,000 tons of steel, valued at $11.5 million, to the UK, Germany, and Italy on March 16 further affirmed the competitiveness of the Hoa Sen brand in the international market.

Inauguration ceremony of the hot-dip galvanized factory invested by the Hoa Sen Phu My Company Limited (Photo: Hoa Sen Group)

The Group recently opened a hot-dip galvanized factory with total investment of over VND500 billion ($21.5 million) from the Hoa Sen Phu My Company Limited, a wholly-owned subsidiary of the Hoa Sen Group.

With the most modern and fully-automated production line from Italy’s Gimeco, including six black steel pipe rolling lines, a tape sawing machine, and a hot dip galvanizing line with a designed capacity of 85,000 tons per year, the factory will produce high quality hot-dip galvanized steel pipe products under the Hoa Sen brand.

After nearly two years of implementation, on March 16, 2019, Hoa Sen announced its successful deployment of the ERP Oracle - EBS system (Enterprise Resource Planning), Version 12.5, with consultation from the Ho Chi Minh City-based SSG Management Solution Joint Stock Company.

A production line at a factory of Hoa Sen Group (Photo: Hoa Sen Group)

With a network of ten factories and more than 500 retail outlets nationwide, the Group’s successful deployment of ERP Oracle - EBS will bring substantial benefits, helping improve management efficiency and reduce operating costs while providing the Group with the resources to achieve its goal of expanding production and business.

One of the Hoa Sen Group’s strategies is to stand firm on both “legs”: domestic consumption and export. It has made significant breakthroughs in exports over recent years.

Looking back over the past year, the steel industry experienced a particularly difficult period, facing major challenges in and from the market, as hot rolled steel prices fluctuated continuously and unpredictably, creating problems for many steel enterprises in Vietnam.

With great efforts made to overcome the tough market challenges, the Hoa Sen Group stabilized and improved its production and business situation, strengthened growth momentum, and continued to maintain its leading position, with market shares of 34 per cent of galvanized steel and 18 per cent of steel pipe.

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