Local Vietnamese producer Formosa Ha Tinh (FHS) has announced another decrease in its local HRC prices, by a moderate $10-11/mt, as the previous reduction announced officially at just $2-5/mt last week was too small to push any sizable volumes.
At the weekend, FHS announced its prices for non-skin passed SAE1006 and SS400 HRC in the local market at $582-590/mt CFR depending on the volume, down by $10-11/mt from the previous levels. The lower end of the range corresponds to inquiries for 20,000 mt and some small lots, while the higher end corresponds to sales of 5,000-10,000 mt. Meanwhile, skin-passed SAE1006 coil prices are assessed at $5/mt higher than non-skin passed coil prices.
Even after the latest cut, the gap between ex-Formosa and ex-China HRC prices in Vietnam has remained very high, at $35-55/mt, as the mood was very negative in the Chinese market at the end of last week. But the situation may gradually change in the coming weeks after today’s strong rebound in Chinese futures and amid hopes of major market sources that the current level is the bottom, as least for ex-China HRC prices.
On Monday, offers for ex-China Q195 HRC in Vietnam were at as low as $515/mt CFR, while that for Q235 they were at $525-530/mt CFR. However, on Tuesday, most offers for Q235 coils stand at $530/mt CFR, not lower. In comparison to last week, the current price levels are almost in line with those seen in the previous deals or just slightly lower, signaling that, even though local quotations and futures prices in China have started to rebound today, it will take time for this to be reflected in the export market.
At the same time, offers for ex-China SAE1006 HRC from traders and second-tier mills and the SteelOrbis reference price for imported HRC in Vietnam have corrected down by $5/mt over the past week to $555-560/mt CFR.