On May 18, Vietnamese steel producer Formosa Ha Tinh Steel announced new local prices for HRC for July shipment at a level $95/mt below last month due to the sharp declines seen in ex-China prices and still bearish sentiments. However, despite the significant decrease, the new prices of the producer are still much higher compared to import quotes.
Formosa Ha Tinh’s prices for re-rolling grade SAE1006 HRC (non-skin passed) to local customers have decreased by $95/mt to $855/mt CIF. Its skin-passed SAE1006 coils are reported at $860/mt CIF, while prices for SS400 HRC are at $850/mt CIF.
Although the producer decreased its prices by $95/mt, the difference between import prices, ex-China in particular, has reached around $70-75/mt. In particular, Chinese suppliers have reduced their offers for SAE1006 HRC by $20-30/mt week on week to $780-790/mt CFR Vietnam, while cheap position cargoes from China for SS400 coils have been reported at $755-760/mt CFR, compared to $755-770/mt CFR last week. “The new prices of Formosa are explained by the absence of import material. In particular, Chinese coils cannot be used for production of HDG which goes for export, while Japanese and Taiwanese HRC prices are now at around $870/mt CFR, which are still too high to be accepted by Vietnam, and Russia faces sanctions,” a representative of the Vietnamese mill told SteelOrbis. Thus, only Indian coils could be a real option for Vietnamese customers to substitute local material, but ex-India HRC offers are still voiced at $850/mt CFR, the same as last week, while buyers have been bidding at $790/mt CFR for material from the major Indian producer.
At the same time, another major HRC producer in the country, Hoa Phat Group, may cut offers for SAE1006 and SS400 HRC to around $800/mt CFR in the local market this month, sources believe, down from $920-925/mt CFR a month earlier. Its prices will be released this week.
The SteelOrbis’ reference price for SAE1006 HRC in Vietnam, based mainly on the most competitive import offers, has come to $780-790/mt CFR on May 18, compared to $800-820/mt CFR last week.
