Posted on 24 Feb 2025
Chinese hot rolled coil faces preliminary anti-dumping duties of 19.38-27.83% in Vietnam from next month following the results of a long-awaited investigation into Chinese and Indian product issued on Friday, Kallanish notes.
Vietnam’s Ministry of Industry & Trade (MoIT) 's investigation targeted 1.2-25.4mm thickness and width not exceeding 1,880mm HRC categorised under 18 tariff lines headed by HS codes 7208, 7211, 7225, and 7226. MoIT launched its investigation last July after receiving a petition from domestic producers Hoa Phat Group and Formosa Ha Tinh Steel (see Kallanish passim).
Preliminary anti-dumping duties levied on Chinese mills and suppliers have been set at 19.38%, 26.94% or 27.83% (see table). Duties on imports of Indian HRC were waived because although there was evidence of dumping practices, their share in Vietnam total imports were insignificant at under 3%.
Vietnamese HRC itself is being targeted in an AD probe by India where an oral hearing is scheduled to take place on 27 February.
Customs data show that Vietnam imported 11.72 million tonnes of the targeted HRC products last year, a 26% year-on-year increase. Volumes from China surged 38% to some 8.4mt.
To prevent the imports from rising significantly, the ministry has decided to implement provisional duties to minimise damage to the domestic industry. The duties take effect from 8 March.
The duties on Chinese HRC are "reasonable" to block imports of Chinese material, according to Vietnamese sources.
"There should be more room for us, but we hear more Japanese and South Korean HRC may want to come to Vietnam because of the US duties," a trader supplying Indonesian HRC says.
The duty will have "some influence but maybe too big" on prices, he says, noting Vietnamese HRC demand is very weak. A 50,000t cargo of Japanese SAE 1006 2mm HRC was ordered earlier last week at $495/t cfr southern Vietnam.
Kallanish assessed SAE grade 2-2.7mm thickness HRC at $490/t cfr Vietnam, up $5/t on-week.
Vietnam is the leading export market for China-origin HRC. In the short term, Chinese sources expect the AD’s impact to be a large and negative. “Forget about 28% – even an 8% tax rate would make it impossible for Chinese HRC to be sold in Vietnam,” says a Shanghai-based trader.
“This spells unemployment. For those traders who rely on Vietnam for their livelihood, the end has come,” one exporter warns.
In the long run, however, some analysts and market participants note there will be a new market equilibrium. "Demand will finally determine where China's export volume will fall to. Prices will reach a new balance after Vietnam's prices rise due to the lack of Chinese supply,” an analyst says.
“Think about China's cancellation of export tax rebates in 2021, and everyone was very pessimistic at that time. Who would have thought that China's steel exports would reach the second highest level in history just three years later?” he adds.
Source:Kallanish
