Following the significant decline over the past month in import HRC prices in Vietnam, in ex-China prices in particular, this week Vietnamese producer Hoa Phat Group has announced its new offers for domestic customers, decreasing them by around $25/mt month on month. However, despite some rebound in HRC futures prices in China as of today, Thursday, August 1, offers from Chinese traders have remained at low levels in Vietnam so far, while most customers believe that a significant price recovery is doubtful.
Specifically, on August 1, Hoa Phat’s prices for non-skin passed SAE1006 HRC and SS400 for September and October shipment have been announced at VND 13,270-13,300/kg ($526-527/mt) CIF, where the lower end of the range corresponds to the prices in northern and central Vietnam, while the higher price is found in the south. This means that the current prices are around $25/mt lower than last month and down by $15/mt since discounted sales in mid-July.
Such a move was expected by most Vietnamese customers, since during July ex-China offers for both SAE1006 and SS400 HRC lost more than $30/mt, falling to $510-515/mt CFR and $485/mt CFR, respectively. However, with the rebound of HRC futures prices on August 1, sentiment has improved among suppliers, especially among Chinese steel mills, though most of them have not made any upward changes in their export offers to Vietnam so far. “The market tried to rebound on the back of macroeconomic news though the support is insufficient in August, as it is traditionally a weak month in terms of demand,” a market insider said.
As of August 1, HRC futures at Shanghai Futures Exchange are standing at RMB 3,505/mt ($492/mt), decreasing by RMB 13/mt ($1.8/mt) or 0.37 percent since July 25, while up 0.78 percent compared to the previous trading day, July 31, according to SteelOrbis’ data.