The imported HRC market in Vietnam has witnessed limited offers and trade in the past one week. With Vietnam’s key business hub, Ho Chi Minh City, under lockdown amid rising Covid cases, buyers have adopted a wait-and-watch approach. Also, there have been rumours in the market that China may announce an export duty on flats soon, another factor that has kept buyers away from booking materials.
Vietnamese imported HRC prices witnessed mixed movements at the very onset of the current week, on May 31 ’21, from major exporting nations.
Offers for the week
- Chinese mills’ offers are on hold. The last offers heard were at $1,030-1,040/t CFR from the major mills.
- Indian HRC position cargo offers were assessed at $1,020/t CFR Vietnam. However, mills are not yet actively offering HRCs for exports. Price indications stand at $1,050/t CFR.
- Japanese mills remained less active in offering HRCs for exports with just one player indicating prices of around $1,100/t CFR.
1. Importers continue to prefer domestic HRC- Being still at a discount, the preference for domestically manufactured HRC remains high amongst Vietnamese buyers. Besides, the continued sense of uncertainty over a prospective increase in export tariffs by the Chinese government is also a factor for traders silently observing the imported HRC price trend.
Formosa’s offers for HRCs stand at around $1,027-1,032/t CIF basis, and Hoa Phat’s at $1,018-1,022/t CIF for July-early Aug ’21 shipments.
2. Chinese mills hold offers amid NDRC’s intervention- The Chinese HRC export offers are on hold from the beginning of the week as mills are awaiting an announcement on the tariffs on exports. China’s National Development and Reform Commission (NDRC) held a meeting on Sunday with major companies and associations representing the iron, steel and non-ferrous sectors and issued a warning against illegal practices that are driving up steel prices.
3. Japanese mills have limited allocations for exports- The Japanese mills are focused on quenching the domestic thirst for steel. Hence, there are limited allocations for exports which has resulted in higher export offers from the country.
Outlook
Vietnam-based trade channel partners are concerned about the new variant of the Covid-19 detected in the country. “There is a new strain of Covid detected in Vietnam. The country’s health minister is likely to hold key meetings to evaluate the situation. We may observe a lockdown in Vietnam, very soon,” informed an importer from Vietnam.
Thus, there is likely to be an increased preference for domestic HRC considering the uncertainty surrounding imported HRC prices and export tariffs adjustment by the Chinese government. The Vietnamese market will stay vigilant of overseas trade opportunities in the upcoming weeks.
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