Hoa Phat's HRC price cut signals slow recovery
Posted on 15 October 2021
Vietnam’s Hoa Phat has lowered its monthly domestic price for new hot rolled coil allocations, Kallanish notes. The price decision revealed on Thursday suggests that HRC demand has not recovered despite the easing of Covid-19 measures in the past 2-3 weeks.
The company’s prices for non-skin passed SAE 1006 HRC for December shipments are at $889/tonne cif Haiphong, $890/t cfr Central Vietnam and $892/t cif Ho Chi Minh City. Its prices for SS400 grade HRC are the same as SAE 1006 HRC. The fall in SAE 1006 HRC is $8-9/t and that for SS400 grade HRC is $4/t. Last month, Hoa Phat's SS400 grade HRC prices were $4/t cheaper than SAE 1006 HRC.
Hoa Phat has to lower prices because the market is still weak and needs time to recover, a Vietnamese trader says. But prices are very near the bottom and are likely to rebound if there are no further lockdowns, he adds. Another trader says he is not sure of the market direction. “The price pattern is not clear,” he comments.
The slow market recovery was a reason for the price cut, a source close to Hoa Phat says. But the company's prices are "still quite high" compared to offers for HRC cargoes from Russia and certain Indian mills for the same shipment month, he adds. A Russian mill's offer for SAE 1006 HRC is prevailing at around $850/t cfr Vietnam.
Hoa Phat's latest domestic price for December-shipment HRC is at VND 20,300/kg cif Hai Phong, which is $890/tonne based on an exchange rate of VND 22,860/USD. Last month, its SAE 1006 HRC price for November shipments was VND 20,500/kg and the exchange rate was 22,850.
Earlier this week, Formosa Ha Tinh announced its offer for non-skin-passed hot rolled SAE 1006 for December shipment at VND 21,010/kg cif Haiphong, down marginally by VND 20/kg from last month.Source : Kallanish