Late last week, Vietnam’s Ministry of Finance published a draft plan according to which the investigation of imports of HRC will be started, while the proposed duty is five percent. Although no other details have been published by the government, the news has rattled the market in Vietnam, which is the largest importer of hot rolled coil (HRC) in Asia. ”It is too early to evaluate its influence. We are waiting for the timing of the investigation,” a major international trader in Asia said.
The Vietnamese authorities will try to protect local market firstly from the inflow of Chinese imports, but it is unlikely that the import duty will be imposed just against China, most market sources believe. “If it is imposed, it should be against all suppliers. India was pretty active in sales recently,” a Singapore-based trader has told SteelOrbis.
If the investigation cover coils, boron-added coils supplied by China and coils from other sources, and if duty is not higher than five percent, then import volumes are unlikely to fall much. “Formosa and Hoa Phat are lobbying for this,” a source said, adding that this will help to increase overall selling prices in the market and protect the profits of the local producers. Hoa Phat is going to start production of HRC next year, with a planned capacity of 2 million mt per year.
In the January-June period this year, Vietnam imported 7.14 million mt of steel, up 4.1 percent year on year. Although China remained the major exporter, supplying 3.04 million mt, the volumes from China declined by 6.1 percent year on year. Steel import volumes to Vietnam from Japan and South Korea respectively decreased by 10.5 percent and 8.4 percent year on year in the given period.