Vietnam: Ferrous scrap imports drop by nearly 20% m-o-m in Sep'23

In September, Vietnam, a significant importer in the Southeast Asian ferrous scrap market, recorded 240,590 tonnes (t) of imports, marking a notable 19% decline from August's figure of 295,603 t. This also represented a significant 25% drop when compared to the 321,170 t imported in September 2022.

The decline in import volumes is primarily attributed to a dip in domestic scrap demand driven by seasonal disruptions. Notably, major suppliers, particularly those from Japan and Australia, experienced a considerable reduction in their scrap shipments to Vietnam. This decline reflects pricing/ bid offer gap challenges in the broader Southeast Asian scrap market.

Hoa Phat Group (HPG), a prominent Vietnamese steelmaker, reported a decrease in crude steel production in September, down 7% from August to 635,000 t, citing maintenance-related downtime at a Hai Duong blast furnace. However, insiders believe this has no significant impact on Vietnam's longs market, as HPG has sufficient stock to meet demand until the end of the maintenance period.

Country-wise shipments

Imports from Japan down 24%: Vietnam imported about 102,479 t of scrap from Japan in September, down by 24% against 134,099 t in August. Imports were down 17% y-o-y in comparison with 123,515 t in September 2022.

Imports from Australia drop significantly: Imports from Australia were assessed at 10,820 t for September, showing a significant drop of 83% against 64,887 t seen in August, 2023.

Imports from Hong Kong down: Vietnam imported 30,645 t of scrap from Hong Kong in September, down by 19% against 37,613 t a month ago. Import volumes slightly up by 2% compared with 29,908 t in September 2022.

Imports from the US up 94%: Imports from the US totaled 57,056 t in September, up by 94% as against 29,376 t a month ago. However, y-o-y import volume dropped by 15% against 67,120 t in September 2022.

Outlook: Scrap import into Vietnam is expected to remain slightly better as mills might procure some volume for winter restocking from exporters like Australia and the US with some competitive price range.