Major Vietnamese steel producer Formosa Ha Tihn has started to announce its new prices for HRC to the local market, raising them by $90/mt compared to January. Meanwhile, import prices from major mills from China, India and other countries have been increasing even despite traders’ lower position offers.
New offers for re-rolling grade SAE1006 HRC (non-skin passed) in the local market for April shipment are reported at $840/mt CFR, up by $90/mt from the previous month’s $750/mt CFR. Skin-passed SAE1006 coils are reported at $845/mt CFR, while prices for SS400 are at $835/mt CFR. “We actually expected a slightly higher price at around $850/mt CFR, but Formosa may increase its prices further next month on better local demand,” a mill’s representative told SteelOrbis.
The export prices of the Vietnamese producer have been settled at $820-840/mt FOB, depending on material grade.
The sharp growth in prices from Formosa has been expected by market sources as import prices from all main suppliers have been increasing rapidly in Vietnam since early this month. In particular, offers from several Chinese mills for April shipment SAE1006 HRC have already been voiced at $870-880/mt CFR, compared to $860/mt CFR last week. Meanwhile, offers from Indian mills for SAE1006 HRC have been reported at $900/mt CFR and above, up by around $30/mt over the past week. Offers for ex-Japan SAE1006 HRC have been heard at $950/mt CFR, while coils from a South Korean mill have been offered at $930-950/mt CFR Vietnam.
At the same time, a number of traders have continued to offer position cargoes at much lower levels in Vietnam this week. After a contract for a position cargo from China was reported at around $825/mt CFR last week, this week a new position offer from a trader for March shipment SS400 HRC has been reported at $815/mt CFR Vietnam. According to some market insiders, this price drop could be explained by the domestic HRC prices drop in China amid tumbling iron ore futures. In particular, domestic HRC prices in China are at RMB 4,995/mt ($786/mt) ex-warehouse on February 14, down by RMB 80/mt ($13/mt) compared to February 11, according to SteelOrbis’ data. However, despite the decrease, market insiders believe it is too early to talk about any downtrend and most Chinese suppliers are still optimistic, believing that, with the continuous resumption of downstream enterprises, steel demand will gradually increase, pushing steel prices up further. “It is expected that the market price of steel will first fall and then rise this week, by a range of RMB 50-100/mt,” a market source stated.
The SteelOrbis reference price for import SAE1006 HRC remains unchanged at $840-850/mt CFR, considering the unclear market situation amid the lack of new import deals and the recent announcement of Formosa’s local prices at $840/mt CFR.