Home / News / News & Press releases / Pebsteel Glides Over Global Challenge

Pebsteel Glides Over Global Challenge

News & Press releases - 13/02/2019

Despite widespread assumptions, the US-China trade war is unlikely to affect Vietnam’s steel businesses in the downstream segment.

The US-China trade war could create a big chance for steel companies like PEB Steel to fill in Chinese producers’ boots.

The US-China trade war could create a big chance for steel companies like Pebsteel to fill in Chinese producers’ boots.

Throughout 2018, trade tensions between the world’s two biggest economies have reverberated across the world. Among the top products that fall victim to this trade war is steel, starting with Chinese steel imports to the US being taxed by 25 percent in March 2018. The issue is getting complicated as the US has accused Chinese steel manufacturers of shifting products to nearby countries, including Vietnam, Malaysia, and Indonesia, to avoid import duties to the US.

For the past year, these anti-dumping accusations had a negative effect on Vietnam’s upstream steel producers. Steel mills in Vietnam are suspected of importing Chinese products, adding some minor finishing touches before exporting them to the US as “Made in Vietnam” steel. The 250 percent tax on Vietnamese steel, imposed by the US’s Department of Commerce last year, was a bitter pill to swallow for local steel exporters.

As a result, the entire steel industry was taken by doom and gloom, accompanied by news of excess capacity and strict export requirements. However, industry experts are now trying to clarify that the trade war and its related tariffs only affect upstream companies. These are the ones at the very start of the production process, who are responsible for collecting raw materials, such as iron ore or coal, before mixing them and creating steel billets for mid-stream businesses.

According to industry experts, the effect is more muted for mid-stream companies, who are tasked with thinning the steel billets. Going further to downstream counterparts, who use the finished steel to build houses and factories, no significant impact of the trade war can be found. This is mainly because downstream businesses in Vietnam respond first and foremost to the domestic construction demand, which is still robust thanks to Vietnam’s rising status as a regional manufacturing hub.

“A lot of people are concerned about our profitability in 2018 due to the trade war. However, it is actually the opposite. Our profits are excellent, and we are proud of the projects we delivered in the past year,” said Sami Nour Kteily, executive chairman of Pebsteel.

The downstream pre-engineered buildings company posted a historic revenue figure of more than $100 million in 2018, which represents a growth of 30 percent year-on-year.

80 percent of factories in Vietnam prefer pre-engineered building technology rather than ready-built materials New opportunities for big players

P.E.B. Pre-engineered building technology is flourishing in Vietnam, as 80 percent of factories chose it over ready-built materials initiatives, Pebsteel aims for a safer environment for all people.

New opportunities for big players

Most experts agree that the Vietnamese steel industry still has ample room for growth despite the risks of lower exports and the trade war. However, growth opportunities are not the same for everyone. For example, in the downstream segment, pre-engineered buildings (P.E.B.) are expected to flourish, while small stores selling conventional steel will be phased out.

In many ways,  pre-engineered buildings technology is superior to ready-made steel because it is tailored to each construction project. Similar to a tailor, P.E.B. engineers will take into account the requirements of individual customers before designing suitable steel products for specific projects. All of the primary framing members, and secondary structural tools, are treated in the factory before being shipped to the job site for setting up the building.
On the contrary, ready-made steel producers – similar to fast-fashion manufacturers – have a one-size-fits-all approach to construction. Customers have to choose from the existing range of materials, which may not match their own unique needs.

The change towards pre-engineered buildings technology in Vietnam is already happening, with 80 percent of domestic factories now built with pre-engineered buildings technology instead of ready-made materials. This trend is similar to nearby markets such as Myanmar, Cambodia, or Laos, where steel mills cannot meet the rising demand for tailored buildings. The pre-engineered buildings market in Vietnam, specifically, is expected to grow by 15 percent in the near future, as manufacturers flock to the country thanks to Vietnam’s increasing openness to global markets.

Pebsteel’s Executive Chairman, Kteily, said that even within the P.E.B. pre-engineered building industry, there is a divide between major businesses and smaller competitors. Bigger players have three distinct advantages: an experienced in-house team of engineers, the latest software of certified standards, and a huge inventory of at least three months’ worth of sales. At Pebsteel Buildings, this amounts to $15 million of inventory.

“We want to build effective and economical buildings. We should take particular care not to repeat the mistakes of the ready-made system. Our products must be of certified origin and our in-house engineers need to always make sure that we can provide tailored solutions for each customer,” said Kteily.

At factories, major businesses can afford to have state-of-the-art welders, together with good materials and a strong team of controllers, who keep tabs on product quality. Added advantages include high-quality accessories and a no-waste system to minimize environmental effects.

Going forward

Buoyed by good prospects and a healthy distance from the US-China trade war, most downstream steel businesses in Vietnam are upbeat about the future ahead. Pebsteel Buildings is among the biggest optimists – the company finished 2018 with a bang and is now eager to see what the future has to offer. Just a few months ago, the company finished the steel structure for the first stage of VinFast’s automobile factory, located in the northern port city of Haiphong.

“This is our proudest achievement in 2018, as we delivered the project in record time and recorded no casualties or penalties,” said Kteily.

The company is the largest supplier of steel structures for the complex and is also the sole foreign contractor to implement pre-engineered buildings technology at the site. The company is “incredibly happy” to take part in a landmark project for Vietnam’s nascent automobile industry. Looking forward, Pebsteel Buildings said that it is planning to export “Made in Vietnam” steel to different markets around the world, as far as El Salvador in the Caribbean. Bound by its commitment to Vietnam’s sustainability goals, the 25-year-old company is also striving to train Vietnam’s next generation of high-quality engineers and to promote green construction in the country.


Local websites







Global website

Learn all about Pebsteel, our worldwide solutions and projects.

Global website

Global website

Learn all about Pebsteel, our worldwide solutions and projects.

Global website