Vietnam mills book imported HRC cargoes at increased offers

Imported HRC offers to Vietnam have increased by $10/t w-o-w basis from major exporting nations

Vietnam mills have resumed imported HRC bookings at increased prices, SteelMint learned from its trade channels. Major exporting nations – China and India have raised imported HRC offers by around $10/t  and Japan and South Korea have increased by $5-10/t on a weekly basis.

Imported HRC offers from India to Vietnam have hit almost seven-months high as similar levels were last recorded in the month of Feb’20, as per data maintained with SteelMint.

Confirmed trades

• A private Indian steel mill based in southern India booked 10,000 t HRC (SAE 1006) for exports to Vietnam near to $525/t CFR levels for Sep end/early Oct shipments. Last week the company sold around 10,000 t HRC to Vietnam at $515/t CFR basis for Sep end/early Oct shipments.
• Another private steel mill based in eastern India booked around 12,000t HRC (SAE1006) to Vietnam at around $525/t CFR basis for Sep end/early Oct shipments
• A Chinese major steel mill booked around 10,000 t HRC to Vietnam at around $518-520/t CFR basis for end Sep shipments.

Reasons driving imported HRC offers to Vietnam

1. Indian mills to lower export volumes: Major Indian steel mills have limited allocation for exports since they have shifted their focus to domestic sales. Thus mills have raised their HRC export offers to Vietnam. Indian domestic HRC prices have increased by around INR 3,500/t m-o-m so far in Aug and are hovering at one-year high levels. Also few mills are likely to undergo maintenance shutdown which may keep supplies tight in near term.

2. Chinese steel mills are less interested to export at lower prices– Steelmakers in China have exported HRC to Vietnam after a long time since they are less interested to offer material at lower prices on robust demand in the domestic market. Also, Chinese steel mills have limited allocations for Vietnam due to competitive pricing from India. Meanwhile, China is offering HRC to other markets at higher prices.

3. Japanese and Korean mills focusing on domestic sales- Japanese mills are also observing demand recovery and mills are ramping up production, thus they are less active in export market.

Domestic offers continue to remain competitive – On the other hand, Vietnam’s domestic mill Formosa Ha Tinh is offering HRC (SAE1006, skin pass) at $505/t CFR basis for Oct deliveries, and it is open for negotiations. The company is, however, offering differential pricing for various kinds of customers, said a source.

Meanwhile, the HoaPhat group has reported the successful commencement of blast furnace No 3 on 24th Aug’20 which will increase the domestic supply of HRC and may reduce reliance on imports.