Prices for Japanese hot rolled coil (HRC) in the export market have been moving upwards continuously over the past month amid the shortage in Asia, good demand in the local market, and still limited allocation for sales abroad.
The latest offers and negotiations of Japanese sellers have been at $600-620/mt FOB for January shipment, while prices have increased from the previous trades done at $580/mt FOB earlier in November. Moreover, since the middle of October prices have surged by $80/mt on average.
“In ASEAN, there are negotiations at $620/mt CFR,” a Japanese trader said. This is the lowest possible price for exporters now, sources reported, as official offers are not below $640/mt CFR Vietnam from Japan. Customers from Vietnam have been asking $615/mt CFR, but no deal has been confirmed.
In other Southeast Asian countries apart from Vietnam, Japanese suppliers have been targeting $640-650/mt CFR, almost in line with offers from S. Korea.
“Moreover, demand from the automotive industry [in Japan] is recovering, making supply tight,” a source said. “We expect production and allocation for export to improve, but not yet,” another insider said.
Market sources agree that prices for HRC from Japan will stay at a high level and will be fixed in new deals in the near future, taking into account the significant shortage in the market.