Vietnam: Ferrous Scrap Imports from Japan Hit 9-Month High in Aug'18

On rising crude steel production, Vietnam witnessed fifth successive rise in its monthly scrap imports from the largest supplier Japan in Aug'18.

Vietnam - one of the fastest emerging steel markets in South East Asia has recorded rise of 8% M-o-M in its monthly scrap imports in Aug'18. As per recently released customs data, the country has imported 425,691 MT ferrous scrap in Aug'18 as against 395,560 MT scrap imports in Jul'18. Demand for scrap remained strong in Vietnam on rising production activities despite firm Japanese scrap prices and corrected global scrap prices.

On yearly premises, ferrous scrap imports to Vietnam increased significantly by 10% Y-o-Y in Aug'18 as against 392,759 MT ferrous scrap imports recorded in Aug'17.

Vietnam's crude steel production recorded at 1.40 MnT in Aug'18, up 6% M-o-M as against 1.32 MnT in Jul'18 and up 47% Y-o-Y as against 0.95 MnT in Aug'17.

Japan remained largest scrap supplier to Vietnam - Japan remained largest ferrous scrap exporter registering fifth successive rise and occupying almost 36% share in total ferrous scrap imports to Vietnam. It supplied 154,104 MT ferrous scrap in Aug'18, marginally up by 2% M-o-M as against 151,162 MT in Jul'18. Earlier to this, highest scrap imports from Japan were recorded 172,645 MT in Nov'17 thus, hitting 9 months high imports in Aug'18.

Vietnam's scrap imports from US also have been rising since last three months. US scrap exports recorded at 76,539 MT to Vietnam witnessing 3% M-o-M rise in Aug'18 as against 74,050 MT in Jul'18 while US exports to Vietnam were recorded at 27,528 MT in May'18.

Followed by other prominent suppliers like Hong Kong (44,481 MT, -12% M-o-M) and Australia (41,025 MT, +6% M-o-M). UK witnessed a mammoth fall in scrap exports supplying just 998 MT in Aug'18 as against 43,291 MT in Jul'18. While Singapore and Cambodia supplied 23,475 MT and 10,506 MT ferrous scrap respectively.

As per reports, the Vietnam Steel Association (VSA) has requested the government to allow steel producers to allow annual imports of 1.9 MnT of scrap for their industry. As the domestic supply of metal scrap only meets 40% of the industry demand, imports are a major source for steel producers.It is expected that ferrous scrap imports may reach 4.5 MnT in CY18.

In addition, they have also proposed to extend licenses of existing importers if they meet the environmental standards. Stricter inspection regulations are being followed against any kind of illegal activities related to scrap imports at the major ports.

Vietnam scrap imports up 12% during Jan-Aug'18 on rising USA exports - During first eight months of CY18, Vietnam imported 2.82 MnT ferrous scrap, up 12% Y-o-Y as against 2.51 MnT imports during Jan-Aug'17. USA scrap exports surged 67% Y-o-Y to 0.60 MnT during Jan-Aug'18 to Vietnam.

According to World Steel Association, Vietnam witnessed 32% Y-o-Y growth in crude steel production during Jan-Aug'18. The country produced 8.94 MnT crude steel during first eight months of CY18 as against 6.77 MnT crude steel production recorded in the same period last year. Rising EAF steel output in Vietnam has led to surged scrap imports as compared with last year.

Country-wise Vietnam ferrous scrap imports -

Quantity in MnT,
Source: SteelMint Stats