SE Asia’s largest ferrous scrap importer- Vietnam has registered a decrease of 16% m-o-m in its import volumes in Feb’21. The country imported 0.32 mn t scrap in Feb’21 as against 0.38 mn t a month ago, as per the data maintained with SteelMint. Limited scrap bookings made due to New Year and Tet holidays along with tighter supplies from US, resulted in lower imports in Feb’21.
- Vietnam’s imports from Japan up significantly, volumes from US and Hong Kong falls-Japan continues to remain the largest scrap supplier to Vietnam at 0.22 mn t, up by 22% m-o-m. Tracking export offers, Japanese domestic scrap prices had also weakened in Jan. Whereas, US and Hong Kong saw a drop in their export volumes in Feb’21.
- Vietnam imported scrap price drops in Jan’21- SteelMint’s monthly price assessment for bulk H2 scrap stood at $450/t CFR Vietnam in Jan’21 (lower by 9% m-o-m) and US bulk HMS (80:20) at $475/t CFR Vietnam in Jan’21 (down by 12% m-o-m).
Vietnam’s steel industry performance so far in 2021– Vietnam’s steel production was recorded at 2.65 mn t in Jan’21, lower by 1% m-o-m. Steel sales stood at 2.11 mn t, lower by 13% m-o-m in the recently released data by VSA.
Outlook– Vietnam based mills have raised imported scrap bookings after the Tet holidays. Chinese domestic steel prices rose sharply making room for imported billets, pig iron etc. Vietnam mills have been actively offering billets for export to China and hence have been actively placing imported scrap bookings.
Notably, most steel producers in ASEAN-6 region are using Electric Arc Furnace (EAF) technology. A total of 28-29 mn t of semi-finished steel production per annum requires at least 30 mn t of scrap to be fed into the production line. Vietnam’s manufacturing sector grew by 5.8% in 2020.
SEAISI forecasts Vietnam’s GDP to grow around 6-6.5 in CY’21 on expected boost in public construction activities and the eventual opening of borders. 2021 will be a much better year for most industries, including the steel industry.
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