Posted on 18 Nov 2022
Vietnamese producer Formosa Ha Tinh Steel (FHS) has lowered domestic prices for its new allocations of hot rolled coil, Kallanish notes. While the new prices may be deemed competitive against imports, continued depressed demand and high inventories could prevent the mill from achieving its targeted sales.
FHS has announced the January/February-shipment price for non-skin-passed SAE 1006 HRC will be at the equivalent of $550/tonne cfr Vietnam, which is around $45/t lower than last month. Skin-passed HRC has been set at $555/t cfr and SS400/pipemaking grade HRC at $550/t cfr.
“It is a good price, I think, for re-rollers,” a Hanoi trader says. He believes re-rollers will buy HRC feed for export orders and that pipemakers will book small quantities to maintain their relationship with the producer.
But others say that weak demand will limit buying. “I think it’s a reasonable price, but demand for cold rolled coil and hot-dipped galvanised coil is still low,” a trader in Ho Chi Minh City says. “While users will buy, they will only order enough quantities to meet their demand.”
Stocks in Vietnam are high of HRC as well as CRC, coated steel and pipe, a Hanoi-based market source says. “Users can buy cheaper re-rolling HRC in-stock at around $520-525/t in the domestic market,” he observes. Most mills usually keep two months of inventory but, in the current depressed environment, they are holding four months or even more of stock. Demand for finished steel has fallen by more than 50%, he adds.
Source:Kallanish
