Key highlights:
- Indian mills actively exporting HRC to Vietnam at higher offers.
- Chinese HRC export offers continue to remain on the higher side.
- Domestic mill – Formosa announced an increase of $45/t in prices for May deliveries.
Indian HRC export prices for Vietnam have increased by $10-15/t in a recent deal concluded for Apr-May shipments. Towards the end of last week, a major private steel mill based in Eastern India reported having concluded a deal for 30,000 t HRC at a $760/t CFR Vietnam basis.
Factors driving the Vietnamese market prices are mentioned below-
1. Chinese mills continue to raise offers- The offers from Chinese mills heard were slightly higher at $760-770/t CFR basis towards the end of the previous week. The offers have been increased by $10/t on the back of possible export rebate cuts and stringent supervision for reducing the air pollution in Tangshan province. Thus, Chinese steel mills are offering HRC to Vietnam at higher prices.
2. Formosa Ha Tinh increases HRC prices by $45/t- Domestic integrated steel maker Formosa Ha Tinh has increased its prices by $45/t for May shipments in the middle of the previous week. Offers for HRC (SAE1006) skin pass after revision stands at $770-775/t CIF basis while that of the non-skin pass is at $765-770/t CIF basis.
3. Higher vessel freight rates- Material movement and logistics are facing major hindrances with a decline in vessel availability. This has led to increased vessel-freight rates by shipping companies. This has also led to higher offers for imported HRC world-wide.
4. Improved consumption- Vietnam’s steel industry is expected to see a growth of 5-6 % this year, with global demand set to rise in developed markets, according to the Vietnam Steel Association (VSA). Other drivers for growth include expectations of rising public investment in infrastructure and the recovery of the real estate market. Thus, importers are actively procuring HRC from major exporting nations on improved consumption.
Near term outlook- Indian and Chinese HRC export offers will continue to remain at the higher end on improved demand. SteelMint anticipates that imported HRC offers to Vietnam will remain strong in the near term.
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