Import hot rolled coil (HRC) prices in Vietnam have maintained their downward trend and sentiments have remained largely negative given no visible signs of a demand recovery coupled with high inventories of HRC both at mills and at ports in the country. In particular, Chinese traders have once again pushed HRC prices down, following a significant fall in futures and local prices at the end of last week. Though some market insiders believe the price drop could slow down, as on Monday, July 18, futures prices have shown signs of recovery.
Accordingly, last week finished with sharp decreases for HRC from Chinese traders in Vietnam, brining offers for ex-China SS400 HRC to Vietnam to $580-590/mt CFR on Monday, July 18, compared to $630/mt CFR offered at the beginning of last week. According to market insiders, a few small deals have been reported at $575-580/mt CFR Vietnam, though most bids from Vietnamese customers have been voiced at around $560-565/mt CFR this week. “We heard ex-China SS400 offers even at $560/mt CFR this weekend, but this level is not workable [for most sellers] at least for now,” a market source stated. Meanwhile, offers for ex-China SAE1006 HRC from traders have settled at $610-620/mt CFR, down by $40/mt week on week. “Rumors have invaded the market. People say they heard offers for ex-China SAE1006 HRC position cargoes at $605/mt CFR and below, but no deals have been signed so far to prove this level,” a Vietnam-based trader told SteelOrbis.
The decrease is explained by the significant drop in ex-China HRC futures prices, which by Friday, July 15, lost around RMB 473/mt ($70/ mt) week on week. However, on Monday, July 18, futures prices recovered by RMB 209/mt ($31/mt) over the weekend, reaching RMB 3,785/mt ($562/mt) for delivery in October.
In the meantime, Indian suppliers, who were offering at $660-670/mt CFR at the beginning of last week, have been staying out of the Vietnamese market this week. According to market insiders, indicative offers for ex-India boron-added coils have settled at $610-620/mt CFR, though $600-605/mt CFR have been also heard in the market. “Offers that we hear from India are at around $610/mt CFR on average may not be impossible, but this time it is difficult to say what is really going on. Besides, the buyers are scared to face huge losses as a lot of cargoes which are still sitting at ports were booked previously at much higher prices,” a market insider told.
The SteelOrbis reference price for imported SAE1006 HRC has moved to $610-620/mt CFR, down by $40/mt over the past week, while lower offers are estimated by most customers as bearish speculation for now.