Imported HRC offers to Vietnam dropped about $25-30/t from China against last week’s levels. Markets in both China and Vietnam are yet to completely resume from the CNY and Tet holidays observed towards January-end, informed sources. Also, Vietnamese buyers are awaiting domestic price announcement of Formosa Ha Tinh (FHS) for April and early-May 2023 sales.
Current week’s imported HRC offers:
- China: HRC (SAE1006) offers stand at around $650-660/t CFR Vietnam down from last week’s $680-685/t CFR. Whereas, HRC (SS400) is being heard around $645-655/t CFR Vietnam this week.
- India: Indian mills are not offering in the market currently amid lower export realisations and focuses majorly on the Middle East and European markets.
- Japan: Japanese offers for HRC (SAE1006) were heard around $700/t CFR.
- No offers from South Korea or Russia heard this week.
Factors affecting imported HRC export offers:
1. Buyers await price announcement from domestic mills: Vietnamese buyers are currently on sidelines awaiting price announcements from domestic mills for April-May 2023 sales in the upcoming days. Apart from this, there are more market participants yet to resume activities post-Tet holidays, highlighted a reliable source.
Also, Hoa Phat delayed its price announcement for March and early-April 2023 sales. Last week, the mill announced its HRC (SAE1006, non-skinpassed) price at $652/t CIF HCMC (VND 15,300,000/t) for March and early-April sales.
2. Chinese HRC futures decline w-o-w: The Chinese HRC futures (May 2023 contracts) on SHFE have been on a continual decline till 5 February since the market resumed tracking on 30 January. Settled price of HRC futures stood at RMB 4,076/t ($601/t) on 6 February, down by a steeper RMB 186/t w-o-w ($27/t), contrasted against RMB 4,262/t ($628/t) as on 30 January.
Moreover, for the Chinese mills, the demand has been a little slow in both domestic and overseas markets in the post-holiday period.
3. Hoa Phat reports a drop in steel sales in January, 2023: The Vietnamese steel major Hoa Phat reported a drop of 28% m-o-m in its steel sales in January, 2023. Total sales of construction steel (including HRC and billets) stood at 402,000 t in January, which was 558,000 t in December 2023. Furthermore, the same was down by 36% against 631,000 t in January 2022, as per company’s reports.
In January, the company has sold 86,000 t of HRC which was down by 40% against 144,000 t in December. Also, the sales volume has dropped by a steeper 62% in contrast with 228,000 t in January last year.
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