Imported HRC offers into Vietnam witnessed a marginal decline from major exporting countries like China and Japan. Moreover, Vietnamese steel major Formosa announced a reduction of $17/tonne in its HRC prices for December and early-January 2023 sales to $593/t CIF Ho Chi Minh City (HCMC) a week back.
This, alongside slow domestic demand in Vietnam, weighed on the quotes for imported HRCs this week, apart from the currency depreciation and inflationary pressures which have kept exporting nations active in the market.
Imported HRC offers to Vietnam:
- China (HRC SAE1006): Mills were heard quoting at $570-575/t CFR slightly down from the previous week’s offer of $570-580/t CFR.
- China (HRC SS400): Offers were heard at around $540-560/t depending upon tier level of mills.
- Japan (HRC SAE1006): Offers dropped to $570/t CFR against the previous week’s $585-590/t CFR levels.
- Russia (HRC SAE1006): Offers were heard at around $560/t CFR.
- India (HRC SAE1006): India is observing major festivals this month — Dussehra and Diwali which kept activties on the lower side on the global trade platform. Thus, fewer indications were heard at around $600/t CFR — unchanged against last week. Meanwhile, most of the mills are focused on the domestic market amid better home realisation.
Factors impacting Vietnamese HRC market:
Vietnam’s production rises, sales drop in Sep’22: The production volumes of finished steel in Vietnam increased by 23.4% m-o-m and 1.7% y-o-y to 2.466 mnt in September 2022. Whereas, total sales volumes dropped by 7.1% m-o-m and 9.9% y-o-y to 1.998 mnt, according to the recent data release by the Vietnam Steel Association (VSA).
Weakening global HRC prices: The prices of HRCs on the global platform have been on a downtrend since March 2022 which has also weighed on the offers from exporting nations. For instance, Chinese HRC offers (monthly average) to Vietnam have shown a consistent decline from $913/t CFR in March 2022 to $605/t CFR in September. Furthermore, the offers on an average have dropped to $580/t CFR as per the previous assessment on 11 October 2022.
Furthermore, Indian offers on a monthly average basis dropped from $895/t CFR in March 2022 to the lows of $615/t CFR in August. However, Indian mills had increased their offers in mid-September to $620-630/t CFR Vietnam which pulled up the monthly average to $624/t CFR for September and has been consistent into October. Moreover, Indian mills had increased their quotes amid better domestic realisation, whereas overseas demand for boron-added HRCs was low amid thhe export duty.
Meanwhile, participants are awaiting updates on Hoa Phat’s HRC prices for December and early-January 2023 sales, which are likely to be announced in the coming days.
Leave a Reply