South East Asia’s largest buyer of ferrous scrap, Vietnam, recorded scrap imports of 0.18 million tonnes (mnt) in July vis-a-vis 0.48 mnt in June – a significant drop of 63% on a monthly basis. Notably, the country’s ferrous scrap imports touched the lowest in six months, as per SteelMint data.
The demand for imported material was dull due to higher finished steel inventories and limited construction activities which is why steelmakers remained absent from domestic and overseas markets. On a yearly basis, too, the country’s imports fell 73% from 0.66 mnt in July 2021.
Load country-wise data:
- Japan emerges as top exporter: Japan was the largest supplier with 59,076 t of total ferrous scrap in July as against 146,886 t in the last month. However, the shipments saw a downtrend of 60% in the same month.
Despite fall in offers of Japanese scrap, buyers were still holding back as prices are still beyond their affordability. Meanwhile, sellers were under pressure to resuce offers amid weak demand and more reasonable scrap offers from other origins.
- Import volumes from USA dip: A major portion of the volumes originated from the USA at 36,097 t, but these fell sharply by 79% m-o-m in the assessment month as against 172,684 t in June. In the absence of Vietnamese buyers, US suppliers prefer to trade with Bangladesh mills, SteelMint understands.
- Imports from Hong Kong fall: Vietnam’s imports from Hong Kong were at 27,822 t in July, witnessing a sharp 35% drop from June levels of 42,858 t SteelMint data showed.
Outlook
Steel producers are cautious due to the unstable economy, low finished steel demand and banking problems might continue to be the major factor behind limited trade. Moreover, heavy rainfall and slow construction activities may lead to slow procurement of imported scrap. Hence, offers are likely to fall further, SteelMint understands.
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