The mood in Vietnam’s import HRC market has worsened again and prices have generally dropped even though some sellers have decided to withdraw offers, waiting for a clearer picture in July. The only limited activity has been heard for local HRC with the major mills completing their sales for this month, while traders are trying to destock, offering discounts to small domestic end-users.
The SteelOrbis reference price for import SAE1006 in Vietnam has settled at $542-551/mt CFR, down by $16/mt on average over the past week. The lower end of the range translates to an offer seen for a mix of SS400 and SAE1006 HRC from India reported late this week. However, even though this signals a price decline for Indian coils from $555-565/mt CFR last week which major mills had been trying to resist, buyers have remained cautious since they think that in the new round of purchases in July they may get lower prices locally and will not have a long wait for import materials to arrive.
The Indonesian mill has been absent in terms of fresh offers, stating that the latest workable levels for them were at $565-567/mt CFR and, when the market has fallen to the current lows, there is no need to offer as customers will not be active in a falling market. However, at least one offer for 20,000 mt of Indonesian coils has been reported at $551/mt CFR, and most market sources believe this is a trader's offer.
In the Vietnamese HRC market, one of the major mills has finished its June round of HRC sales. “June sales were only around 500,000 mt, significantly lower than in May [over 600,000 mt],” a Vietnam-based source said. The mill’s price for the export market has been heard at the latest at $550/mt FOB and its last domestic sales were equivalent to $555-565/mt CIF (excluding VAT), versus the levels of $583-584/mt CIF announced in early June. Moreover, some traders, having high inventories, have provided discounts to sell at VND 16,000/mt with VAT, which translates to $553/mt excluding VAT. “The market is waiting for Hoa Phat’s new prices and the market is so bad that a further decline is inevitable,” a trader commented.
As for Chinese HRC in Vietnam, trading has almost stopped. Some rare offers for Q195 HRC have been heard at around $508/mt CFR. However, with the absence of demand in Vietnam, some Chinese SAE1005 HRC has been traded to Pakistan at $545/mt CFR this week, which is in line with offers to this destination seen a week ago.
