Posted on 05 Nov 2021
Sentiment in Vietnam's hot rolled coil market is dampened by low-priced import offers this week, Kallanish notes. Traders are short-selling cargoes for delivery in February-April next year, reflecting their bearishness over the market.
“Prices appear to be going down to a level where they are supposed to be,” a Vietnamese mill source says. This is particularly so with the sharp downward correction in iron ore.
Trading sources report a wide price range. Offers from these position-taking traders are at $840-850/tonne cfr Vietnam for February shipment, a regional trader says. But he adds that there are “some crazy offers at $810/t cfr too”.
A Vietnamese trader says that certain “reliable” traders are short-selling SAE 1006 HRC for April shipment at $765/t cfr. The originating country is specified as Russia, India or China, at seller's option. Market sentiment has been hit by such offers. "There are no buyers. The market is dead," the trader said on Wednesday.
Another Vietnamese trader says he has heard of many offers from "very aggressive traders." This includes SS400 grade HRC from China for February shipment at $800/t cfr Vietnam. However, buyers prefer December/January shipments because they are less risky. "They need cargoes for their production as demand is recovering gradually," he observes.
While there are currently no offers for SAE 1006 HRC, offers for SS400 HRC from China are prevailing at $820-860/t cfr Vietnam. Buyers are hesitant to take up these offers because they are waiting for cheaper offers from Russia, he adds.
Prices have also dropped considerably in the Philippines. Offers for SS400 HRC and hot rolled sheet from China are down to $870-880/t cfr Manila. Prices started falling last week and were previously at $910-920/t levels, a Manila trader says.
Meanwhile, a new Indonesian blast furnace producer will commence exports of HRC. Its trial lot offer is for 20,000-30,000 tonnes of 2mm up thickness Q195L/SPHC grade HRC for December shipment at $810/t cfr Vietnam. The mill, which produces billet and wire rod, commenced exports of slab in August.
Source:Kallanish
