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Vietnam: Bulk ferrous scrap import prices fall $5/t w-o-w amid bid-offer mismatches

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Melting Scrap

BigMint Bureau

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20 Jan 2025, 19:03 IST

Vietnam: Bulk ferrous scrap import prices fall $5/t w-o-w amid bid-offer mismatches

Potential US-China trade tensions keep market uncertain

Vietnamese buyers reluctant to raise purchase prices

The Vietnamese imported scrap market saw a $5/tonne (t) decline in the last week, primarily driven by the ongoing gap between buyer-seller expectations.

H2 prices in Vietnam were reported at $312-315/t CFR, with tradable levels at around $310/t. Bids for H2 were at $295/t, with some indicatives falling below $305/t CFR Vietnam. Despite this, suppliers were hesitant to accept the lower bids, likely preferring to target markets with higher offers.

HMS 80:20 deep-sea bulk scrap offers were scarce in the spot market, driven by weak demand and a disparity between buyers' and sellers' price expectations.

HS offers were reported at $346-350/t CFR Vietnam and $345/t CFR Taiwan. Indicative bids for open-origin cargoes were at $335/t CFR, with tradable values at above $340/t CFR.

Japan-origin H1/H2 offers were priced at $301-313/t CFR Taiwan. The weak demand in Taiwan and competition from higher prices in markets like Vietnam contributed to the lack of deals.

Restocking expectations

A Vietnam-based trader mentioned that no H2 offers have been received so far. Japanese collectors appear to anticipate a price hike following the Kanto tender results, but Vietnamese buyers remain reluctant to raise their purchase prices.

Downstream demand

Downstream demand in Vietnam remains soft, attributed to sufficient mill inventories, minimal restocking ahead of the Tet holidays, and slow market activity. This has kept the market subdued.

CFR assessments

Deep-sea bulk US cargoes of HMS (80:20) were assessed at $335/t, down by $5/t w-o-w.

Japanese-origin H2, a major tradable grade in Vietnam's scrap market, was down by $5/t at $310/t CFR Vietnam.

Market sentiment

A mill-side participant in Vietnam noted that market participants are likely adopting a cautious, wait-and-see approach. Some expect market fluctuations due to potential US-China tariff developments, adding uncertainty to pricing trends.

Despite the January Kanto H2 grade scrap tender closing at a higher price, some market participants in Vietnam believe it will have limited impact on spot pricing sentiment due to the prevailing demand and supply conditions.

A Vietnam-based trader commented that construction activity and investments are picking up in the country this year, with the private sector gradually advancing some projects, contributing to the optimism in the market.

Outlook

Despite the current softness, market participants in Vietnam expressed cautious optimism, expecting a rise in demand in the coming term as construction activity and investments continue to increase.