Vietnam: Imported scrap offers continue to rally, buyers retreat

There was a slowdown in Vietnam’s imported scrap market on the back of the sharp hike in offers from prominent suppliers. Market players are holding back from placing new orders.

However, some offers were heard:

• US-origin bulk cargos were being offered at $555-560/t CFR levels, inching up by $5/t w-o-w.
• Japanese scrap offers surged to $560-570/t, registering a sharp hike of $10-20/t w-o-w. The bids for the same were, however, heard below $20-25/t levels.

It has been observed that post-Kanto tender, Japanese scrap offers surged to a new all-time high. A prominent buyer like Hyundai Steel in South Korea also lifted its bid prices for the Japanese material.

Vietnam’s billets export offers up: Vietnam’s BF-route billets export offers stood at $695/t FOB, an increase of around $5/t w-o-w. However, no deals were heard to have been concluded this week.

Ferrous scrap imports plunge 70% m-o-m in Jan, rebound likely: Vietnam’s ferrous scrap imports were recorded at 0.16 million tonnes (mnt) in Jan’22, showing a plunge of 70% m-o-m vis-a-vis 0.54 mnt seen in Dec’21. The USA was the largest supplier followed by Japan and New Zealand, in Jan’22. Bearish domestic and overseas steel markets kept demand for imported scrap limited while buyers remained less active in Dec’21.

In 2021, despite many difficulties and challenges due to the COVID-19 pandemic, the steel industry still witnessed good growth, more than 16%, compared to the previous year, as per the Vietnam Steel Association (VSA).

Where steel consumption is concerned, demand in Vietnam has shown positive signs for civil works and infrastructure, especially large public investment. Hence, imported scrap volumes into the country are expected to regain momentum in February with the easing of lockdown measures.

Overview of other SE Asian markets

• Thailand’s imported scrap offers range-bound, trade subdued: Imported scrap trade to Thailand slowed down, owing to slow market activities. Yet, the offers remained mostly unchanged.
  Recent offers from Central America

1. HMS 1&2 (70:30) containers were offered at $450-455/t CFR Laem Chabang, unchanged w-o-w.
2. HMS 80:20 were at $480-490/t CFR
3. Shredded, at $520/t CFR

• Indonesia scrap offers up slightly: Scrap offers to Indonesia inched up slightly as compared to the preceding week, following the global price uptrend. However, trade has yet to improve, while prices of containerized PNS moved up by $10/t w-o-w to $545/t CFR Jakarta basis. Meanwhile, HMS is being offered at $510/t CFR.