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Vietnam: Formosa Ha Tinh cuts HRC prices for August 2024 sales

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BigMint Bureau

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13 Jun 2024, 18:07 IST

Vietnam: Formosa Ha Tinh cuts HRC prices for August 2024 sales

Vietnamese steel major, Formosa Ha Tinh, has reduced hot rolled coil (HRC) prices by $30/tonne (t) m-o-m for August 2024 shipments. Prices fell amid declined imported HRC offers as well as competitive prices from both domestic and global competitors. Subsequent to the revision, prices of HRCs (SAE1006, skin pass) stand at around $570-580/t CIF Ho Chi Minh City (HCMC). Meanwhile, non-skin pass coils are at around $565-575/t CIF, sources informed BigMint.

Factors behind drop in HRC prices

1. Drop in imported HRC offers:

Chinese HRCs (SAE1006) monthly average prices drop by around $10/t to $552/t CFR HCMC, against $565/t CFR HCMC in May, 2024. Offers for HRCs (SS400) stood at around $540-545/t CFR HCMC in June, 2024.

Indian mills are currently not offering HRC exports due to better realisations in the domestic market and weaker global market sentiments.

2. Falling domestic, global prices : Vietnam's steel major Formosa has reduced its HRC prices as domestic competitors have also reduced their HRC prices. Formosa's domestic competitor Hoa Phat has reduced its monthly HRC (SAE1006, non-skinpassed) prices by around $10-15/t for August, 2024 sales, sources informed BigMint. Post-revision, effective prices stand at approximately $565/t or VND 14,435,000/t for Southern region, excluding VAT. Meanwhile, Baosteel has kept HRC prices stable for July 2024 sales, after increasing in June, 2024. Moreover, hot-dip galvanized prices also remained unchanged. The company rolled over prices due to slow market demand, while, buyers are cautious ahead of summer in China.

3. Chinese prices drop amid decline in SHFE futures: China's HRC export offers dropped amid declined SHFE HRC futures. Moreover, market sentiments in China remained slow due to Dragon Boat festival. Despite drop in steel inventories in late-May 2024 prices remained low amid slow global demand. In addition, anticipation of lower demand in summer, Chinese market participants are hesitant to build inventory. Shanghai Futures Exchange (SHFE) futures decreased by RMB 25/t ($3/t) w-o-w to RMB 3,778/t ($521/t) against RMB 3,803/t ($524/t) a week ago. Moreover, on d-o-d basis the same remained range-bound.