Prices for HRC have increased again in the Vietnamese market in the latest deals from India. In fact, India has been almost the only source of import HRC to Vietnam lately and this situation is unlikely to change in the near future, taking into account the absence of China from the export market and the expected cut in the export tax rebate for HRC from China from the current 13 percent to zero.
At least two deals for 20,000 mt of SAE1006 HRC each have been closed at $840-845/mt CFR this week to Vietnam from India. This price level is $35-40/mt above the previous contract from India at $805/mt CFR, signed late last week. Indian sellers have confirmed that they have increased prices to $850-870/mt CFR on Thursday, April 1. “There are no firm offers from any other exporter,” a trader said.
Chinese exporters are not giving firm offers or are voicing much higher prices to foreign buyers, trying to avoid risks of the expected sharp tax rebate cut. Some mills are discussing sales of SAE1006 HRC at $790/mt FOB, but only if the customer will assume all risks of the possible loss of the 13 percent rebate. The latest tradable value for ex-China boron-added SS400 HRC has been at $760-765/mt FOB, as SteelOrbis reported earlier, but, if the export tax rebate is dropped to zero, it will lead to an almost $100/mt loss for the seller. “All eyes are on China now,” an Asian trader said. The official announcement for the tax changes is expected to be made by April 10.
Other Asian suppliers like Japan and South Korea have not been interested in sales to Vietnam, seeing that prices there are still too low, taking into account the higher freight and better realizations in other markets. The tradable price level for thin ex-Japan and ex-S. Korea HRC is estimated at $880/mt CFR minimum, while firm offers are only at $900/mt CFR and above.
The SteelOrbis reference price for import HRC in Vietnam has been increased by $35-40/mt to $840-845/mt CFR.
