Posted on 20 Jun 2022
The Vietnamese hot rolled coil market continues to deteriorate, Kallanish notes. Vietnamese producer, Formosa Ha Tinh Steel has lowered the domestic price for its August shipments further. At the same time, traders are pressing down the import market more quickly than expected by short-selling.
Formosa has cut the offer price for its new allocations of non skin-passed SAE 1006 HRC to $724-725/t cfr Ho Chi Minh City (HCMC), local industry sources reported on Friday. “The price is adjusted after FHS offered at $756/t on 14 June,” a southern Vietnam trader notes. The mill’s latest offer price to northern Vietnam is $720/t cfr Haiphong.
Consequently, local market sources now expect that the other Vietnamese strip producer, Hoa Phat will announce even lower prices for its new HRC allocations.
“I think that Hoa Phat is now expected to cut its prices to around $700-705/t,” the trader says. “China is very competitive. And Hoaphat is hungry too,” another trader based in Hanoi says. Hoa Phat has recently cut the domestic prices for July/August shipments by $20/t to $780/t cif HCMC for SAE 1006 grade HRC ($775/t for SS400) on 1 June. Hoa Phat has been tagging its monthly HRC domestic prices below that of FHS.
In Vietnam’s import market, certain traders were offering 3-12mm SS400 grade HRC for August shipment from China at $700/t cfr Vietnam, down from $735-740/t cfr just a week before. Chinese and Vietnamese trading sources were surprised by this price, saying this is the lowest they have heard in the current import market.
“Traders are pre-selling the material,” a Chinese trader says. But he notes that bids are only at $685/t cfr. “Now no one will touch [the offer],” a regional trader says on the negative market. “People are still waiting for better prices because they do not think that the market has hit bottom yet,” a Hanoi-based trader says.
One trader is also short-selling 2-2.5mm thickness SAE 1006 for July shipment from a popular Chinese mill at $715/t cfr Vietnam. “It has to be a trader’s position because the mill will not offer at this low price,” a Chinese trader says. Other offers for Chinese- as well as Indian-origin SAE 1006 HRC are prevailing at $735-740/t cfr Vietnam, Vietnamese trading sources say. Kallanish lowered SAE 2-2.7mm thickness HRC to $715-720/t cfr Vietnam, down $35 on-week.
Source:Kallanish
