Vietnam: Formosa increases HRC offers by around $60/t for Apr'23

Vietnamese steel major Formosa Ha Tinh has increased HRC prices by $59/t m-o-m for April 2023 shipments. Subsequent to the revision, prices of HRC (SAE1006, skin pass) stand at $699/t CIF Ho Chi Minh City, while non-skin pass coils are assessed at $694/t CIF, sources informed.

A hike in imported HRC offers and supportive sentiments globally have pushed South East Asian mills to raise offers this month.

Factors driving up offers -

1. Current imported HRC offers:

• China: Chinese mills are offering HRC (SAE1006) at $660/t CFR Vietnam, up $20/t m-o-m against $640/t CFR a month ago.
  
  
• India: There are no firm offers from Indian mills at prevailing levels and they are waiting it out in expectation of further increase in prices.
  
  
• Japanese mills continue to offer at around $700/t CFR.
  
  

2. Supporting price trends in global market: Prices in overseas markets have increased. For instance, China's leading steel manufacturer, Baosteel, has raised HRC, CRC and HDG prices by RMB 200/t ($29/t) m-o-m and heavy plates prices by RMB 300/t ($44/t) for March sales. This is the third monthly price hike in a row by the company amid increasing raw material costs and anticipation of demand recovery.

3. Chinese HRC futures rise w-o-w: Chinese HRC futures (May 2023 contracts) on SHFE rose w-o-w along with the increase in domestic HRC prices. Settled prices of HRC futures were at RMB 4,164/t ($607)/t) on 15 February, up RMB 78/t w-o-w ($11/t) against RMB 4,086/t ($596/t) as on 8 February.

4. Vietnam's steel exports stable in Jan: Vietnamese steel exports have stayed close to last month's levels. In January, exports stood at 0.6 mnt as against 0.8 mnt in December. India and Italy were the leading importers in January at 0.10 mnt each, followed by Cambodia (0.09 mnt), Turkiye (0.06 mnt) and Malaysia (0.04 mnt).