Hoa Phat Plans to Start Dung Quat 2 Production from 2022
Hoa Phat Chairman Mr Tran Dinh Long informed shareholders last week that the Dung Quat 2 project is part of the 10 year development plan of Hoa Phat and is relatively favourable in this period. Total HRC demand is 12 million tonnes, growing by 10% every year. Hoa Phat and Formosa made about 8 million tonnes, so they decided to invest in Dung Quat 2. Currently, Hoa Phat produces 250,000-300,000 tonnes of HRC every month, but if there is 1 million tonnes, they also sell out. Therefore, the Group is speeding up legal procedures and site clearance to deploy the Dung Quat 2 project from the beginning of 2022. The project has an expected capacity of 5.6 million tonnes per year, of which there are 4.6 million tonnes of flat steel HRC) & 01 million tonnes of high quality bar and wire rod. Expected implementation progress is 36 months from the date of handover of land and construction permit.
He also told that Hoa Phat Dung Quat Iron and Steel Production Complex Dung Quat Dung Quat 1 has been completed and started synchronous testing from January 2021 and the millionth tonne of HRC steel was born a month later. The current factories are running at full designed capacity but have yet to meet market demand.
With an area of 283.73 hectare, Dung Quat 2 is expected to have a total investment of 85,000 billion VND, of which fixed capital is 70,000 billion VND, working capital is 15,000 billion VND. Upon completion of this project, the steel production capacity of Hoa Phat will be 14 million tonnes per year, expected to be in the Top 25 largest steel companies in the world.