Vietnam: Imported HRCs offers increase by $15/t w-o-w

Imported hot rolled coils (HRCs) offers for Vietnam from China increased by about $10-15/t this week. Better in-home realisations in China kept mills quoting higher. Moreover, Vietnamese buyers have sourced up allocations from domestic mills at elevated prices, sources said.

Current offers:

• China: HRCs (SAE2006) were heard offered at $690-695/t, up from last week’s $670-680/t CFR. Offers for HRCs (SS400) were heard at around $680/t CFR.
• Indian mills are likely to come up with higher offers in the upcoming week.
• Japanese and South Korean mills are focusing on better opportunities in the US market.
• No offers from Russia were heard this week.

Vietnamese buyers dry-up domestic supplies at higher prices: The domestic steel major, Formosa Ha Tinh, has exhausted its allocations for April and early-May 2023 sales despite a price increase of $59/t m-o-m to $699/t CIF Ho Chi Minh City (HCMC), informed some local trade sources. This shows an improved demand in the country and expectation of further hikes in the upcoming weeks.

European demand a major opportunity: Europe is a major export market for the Vietnamese value added flat steel products. Thus, Vietnamese re-rollers and downstream processors are eyeing for exploring the export opportunities because of the Turkiye mishap.

“There is still hope that the European market’s demand for Vietnamese origin products shall pick up pace,” a source said. Furthermore, the European Commission is yet to go vocal about how it is going to weather the import losses from Turkiye. This in turn should push demand and prices for both domestic and imported HRCs, he added.

Outlook

Chinese mills are likely to quote higher in the overseas market amid an improved domestic demand and prices, opined most of the participants. The domestic Chinese HRCs prices rose by RMB 80/t ($11/t) w-o-w to RMB 4,230/t ($608/t) exw-Tianjin including VAT at 13%. This should in turn fuel up prices from other exporting nations. Hence, imported HRCs offers to Vietnam are likely to rise in the near term amid firm global HRCs prices and an expectation of sustained demand in the overseas markets.