In order to implement the Prime Minister’s instruction on restraining commodities’ prices to help curb inflation and stabilise the national economy, most industrial groups have committed not to raise sale prices.

Steel makers not to raise prices

Petroleum, electricity and coal distributors, as per request of the Prime Minister, have pledged not to raise prices from now to the end of June 2008. Most recently, steel producers have also announced they will follow the move.

Pham Chi Cuong, Chairman of the Vietnam Steel Association (VSA), said that the association’s members reached an agreement in March on keeping steel prices unchanged if the ingot steel prices did not exceed the $900/tonne level. Now the steel producers have repeated the promise not to raise sale prices in April 2008.

Cuong said that the ceiling sale price level will be capped at VND15.8mil/tonne.

Currently, steel mills are churning out steel with ingot steel imported at $860-870/tonne. No producer has to buy ingot steel at $900/tonne, except Vinakyoei. The mills have also stored 400,000 tonnes of ingot steel, enough for production through the end of May 2008.

VSA said that the ingot steel price seems to have stopped rising. Suppliers are now offering products at over $900/tonne, but no Vietnamese company accepts to buy ingot steel at this price, and the offered price has not increased.

No price increases for fertiliser products

Chairman of PetroVietnam Dinh La Thang said that PetroVietnam has asked the Phu My Fertiliser Plant to run at full capacity to ensure maximum output.

He said that it is necessary now to build a distribution network which allows farmers to directly buy products, and to build the single-price scheme, under which a single sales price would be applied nationwide.

Thang said that PetroVietnam has asked the fertiliser plant to push up production in order to churn out 70% of the total domestic output and maintain sale prices 10-15% lower than the market prices.

As for LPG, PetroVietnam will ensure meeting 65-70% of the market’s demand with its products and imports.

Vinashin takes action to help curb inflation

Pham Thanh Binh, Chairman of the Vietnam Shipbuilding Industry Group (Vinashin), said that Vinashin has set up a steering committee on implementing the Prime Minister’s instruction on fighting inflation.

Binh said that Vinashin has asked its member companies to economise fuel, electricity and steel and cut expenses in order to avoid raising sales prices. Moreover, it will also restructure its investment projects and cut unnecessary projects. Vinashin has 257 projects, 101 of which have been completed, while the others are under execution. Vinashin will focus on the 30 most important projects, including Cai Lan steel project and the one on engine installation at the Bach Dang shipbuilding factory.

Vinashin’s total investment capital is VND47tril, including VND30tril worth of loans.