Steady demand and short supply continues to drive imported HRC offers in Vietnam

Vietnam's imported HRC market has witnessed a price hike by $10/t w-o-w tracking gains in Chinese offers. China remained a key supplier amid limited allocations from India. Last week imported HRC offers for Vietnam had climbed to nearly two-years high, as per data maintained with SteelMint.

Last week a deal was heard to have concluded with China's major - Baosteel at $603/t CFR Vietnam. Few market sources also highlighted another Chinese HRC deal has concluded at $610/t CFR Vietnam levels towards the closing of last week.

Price rally expected to continue in the near term due to:

1. Higher HRC export offers from China: At the beginning of Nov'20 nation's HRC export offer stood at $528/t FoB China which has touched around $568/t Fob basis towards the end of the month. Nation raised its HRC export offers on the back of higher domestic prices. This led to a steep hike in imported HRC offers to Vietnam. Chinese domestic HRC prices have increased from RMB 3,970/t in early Nov to RMB 4,210-4,220/t (eastern China) towards the end of the month.

2.Indian mills remain less active for exports- Indian mills are not much active in offering HRC for export to Vietnam on higher domestic prices and tight supply.

3. Premium offers from Japan and Korea- Japanese and South Korean mills are offering HRC at premium prices as compared to Chinese mills. Japanese and South Korean mills are offering around $640/t CFR and Chinese mills offering at $610/t CFR basis.Vietnam buyers are bidding at $620/t CFR levels for Japanese & Korean HRC, sources reported

Will imported HRC offers continue to increase?
Imported HRC offers may gain some strength in the near term. Also, an increase in demand with deals getting concluded at higher offers may lead to further hike in offers.