Vietnamese HRC producer Hoa Phat Group has announced new prices for April-May shipments, reducing them by approximately $11/mt compared to the previous month. While the price adjustment is minor, it has been driven by sluggish domestic demand and aligns with market expectations, as import offers - particularly for ex-China HRC - have yet to show signs of a recovery after the long holiday.
Specifically, on February 6, Hoa Phat’s prices for non-skin passed SAE1006 and SS400 HRC for April-May shipment have been announced at VND 12,810-12,840/kg ($507-508/mt) CIF, where the lower end of the range corresponds to prices in northern and central Vietnam, while the higher price is found in the south. Thus, the current price is around $7/mt lower than last month.
The decision to decrease prices had been expected since this week most traders have been losing confidence, seeing no signs of any significant improvement in the Chinese market after returning from the New Year holiday. The latest offers for ex-China Q235 HRC have been reported at $475-480/mt CFR for March shipment, against $479-482/mt CFR before the holiday, though, according to sources, most bids have already been voiced at below $470/mt CFR. At the same time, offers for ex-China SAE1006 HRC have been estimated at $490-495/mt CFR, the same as before the holiday, while offers from Indonesia have been voiced at $505/mt CFR, though no deals have been reported so far. Thus, the SteelOrbis reference price for import SAE1006 HRC in Vietnam has remained at $490-495/mt CFR.
In the meantime, most market insiders have remained more negative than positive in terms of the future price trend as no significant recovery has been seen in futures prices in China. In particular, as of February 6, although HRC futures at Shanghai Futures Exchange have increased slightly by 0.67 percent compared to the previous day to RMB 3,452/mt ($481.5/mt), the prices are still down RMB 33/mt ($4.5/mt) from the last trading day before the holiday on January 27, according to SteelOrbis’ data.
“Today, the Chinese steel market shows signs of improvement, with recovering demand helping to stabilize prices. Steel futures received a slight boost due to the rapid uptick in demand, and, despite higher inventory levels, market confidence remains intact, leading to a RMB 10-20/mt gain at the ex-mill level. However, the export market remains challenging and uncertain. While mills have raised their base prices, securing lower trade deals has become increasingly difficult under current conditions,” a market insider said.
$1 = RMB 7.272
