Posted on 18 Aug 2022
Vietnam’s second strip producer, Hoa Phat Dung Quat, has lowered its domestic hot rolled coil price for October shipments. The company’s price announcement comes two days after leading strip producer, Formosa Ha Tinh Steel, announced a price cut for October shipments, Kallanish notes.
Hoa Phat has set prices for non-skin passed HRC at the equivalent of $595/tonne cfr Vietnam for both SAE 1006 and SS400 grades, a company source says. According to Wednesday’s announcement, the mill advised that its HRC price for October shipments is at VND 14,000/kg ($0.60), excluding VAT, and requested that customers confirm orders by 23 August. The price applies for both Ho Chi Minh City (HCMC) as well as Hai Phong, the source says. The latest prices are $15/t lower from last month.
“The market is very cautious. Demand is low so buyers may not book much tonnage at this price level,” a HCMC trader said on Wednesday. He believes that Vietnamese buyers will also be looking at the Chinese steel futures markets for direction. He has heard of a small quantity of Chinese SS400 grade HRC booked at $595/t cfr Vietnam. A Chinese trader reports that a trader’s 1,000-tonne position lot was booked at $595/t cfr Vietnam on Wednesday.
“The Vietnam market is very weak,” a regional trader says. “Many re-rollers have been caught out by the steep decline in steel prices over the last three months and thus have expensive HRC stocks.” Their inventory cost averages at $840/t cfr, which is more expensive than current cold rolled coil prices at average $810/t fob for October shipment, he notes.
Formosa Ha Tinh is the larger of the two strip producers. But Hoa Phat is aiming to overtake Formosa when it commissions its expanded capacity at end-2024. Formosa previously announced it was pegging its non-skin-passed SAE 1006/SS400 HRC for October shipment at $610/t cfr Ho Chi Minh City.
Source:Kallanish
