Mood still bearish in Vietnam’s HRC market, buyers await Formosa’s new prices

Friday, 08 October 2021 16:10:27 (GMT+3)   |   Istanbul

The general sentiment in Vietnam’s import HRC market has remained bearish as demand from end-users has failed to improve so far, even despite the better outlook held by Indian HRC suppliers and the price rises in China. Major importers have been waiting for the price from the main local producer Formosa Ha Tinh early next week, which is expected to decline, though otherwise the price may be unchanged or even a slight uptick may be possible.

The latest offers for ex-India SAE1006 HRC from mills have still been reported at $890-905/mt CFR and suppliers have not been very active in offering as they have faced low bids from Vietnam. “Indian prices will have to fall down to $850/mt CFR Vietnam due to weak demand,” a local Vietnamese trader said, adding that, though a part of Covid-19 restrictions has been lifted, this has failed to support the finished steel market much so far. “Production of HDG is reduced. I don’t see much improvement,” another source said.

But, on the other hand, demand for HRC from the local market in India has started to increase, making exporters cautious in the export market.

New prices from local HRC producer Formosa Ha Tinh are strongly awaited in Vietnam early next week. “Formosa’s price may go down to $890/mt CFR for SAE1006 [from the current $920/mt CFR],” one of the market sources stated. However, some sources believe that higher input costs may prevent prices from recording any further decrease.

For higher grade ex-Japan or ex-S. Korea 2 mm HRC, Vietnamese customers have been looking for $940-950/mt CFR, but offers have been only at $970-1,000/mt CFR, mainly from Japan.

The average HRC price in the local spot market in China have posted an increase after the holiday to RMB 5,870/mt ($909/mt) ex-warehouse, up RMB 95/mt ($15/mt) from the level before the holiday on September 30, according to SteelOrbis’ information. This has also been assessed as a positive sign in the import HRC market in Asia.

The SteelOrbis reference price for import SAE1006 HRC price in Vietnam has remained at $870/mt CFR this week.

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