A plant invested by Hoa Phat Group, Vietnam’s leading steel maker, to manufacture containers in Ba Ria-Vung Tau province will test run in the third quarter and launch products from the fourth quarter.
The plant is expected to reach a capacity of 200,000 TEU/year by the end of 2023. The figure can rise to 500,000 in the second phase.
Products are common containers which are 20-40 feet in length, according to its release.
Hoa Phat aimed to debut the plant “as soon as possible to cash in on the serious lack of empty containers shipped to Vietnam from overseas”.
Due to the Covid-19 pandemic, the release and rotation of empty containers have been stagnant, while demand for exporting goods to Europe and the US keeps rising as economies are reopening, leading to a scarcity of containers and a surge of container rental and transportation costs.
In Vietnam, there are a few dozen businesses related to containers (excluding service businesses), but most of them are mainly involved in container repair and renovation.
Hoa Phat Group’s three major business lines are steel, real estate (residential property and industrial parks) and agriculture.
In the first two months of the year, Hoa Phat’s construction steel sales reached 828,000 tonnes, a 2.2-fold increase year-on-year. Of this, 174,000 tonnes was shipped overseas, 2.6 times higher than the same period last year. Major export markets are Singapore, Hong Kong, Canada, Japan, South Korea and Cambodia.
The group’s complete construction steel products are expected to grow over 20 percent this year against 2021.