Vietnam: Imported ferrous scrap market goes silent on national holiday

Demand for imported scrap in Vietnam remained subdued as the country observed its National Day holiday. Price movements this week were mixed, with most buyers choosing to stay on the sidelines and exploring attractive options in the local market. Offers for Hong Kong-origin HMS 1&2 (50:50) increased by $5/t w-o-w, reaching $375-380/t CFR Vietnam as sellers found better opportunities in other markets. Japanese suppliers, however, reduced their prices slightly for high-grade material to an average of $423/t CFR but failed to attract interest.

Offers and indicatives

• H2 offers for Vietnam have been in a consistent range of $385-$390/t CFR, while purchase offers continue to remain below the $380/t-CFR mark.
  
  
• Bulk 80:20 scrap offers, originating from the US, were at $395 to $405/t CFR Vietnam, slightly up w-o-w.
  
  

Domestic market: Purchasing prices for northern mills for H2 grade stabilised at VND 8,800/kg ($365/t) delivered duty paid (DDP), while H1 grade remained at VND 9,100/kg ($378/t) DDP. Vietnamese producers continued to favour local materials to mitigate currency risks. A source stated that due to currency fluctuations, buyers in Vietnam were inclined to purchase domestically.

Rebar market: Rebar offers remained steady at VND 13,300-13,600/kg ($554-$567/t) ex-works, following a VND 100/kg ($4.2/t) decrease last week. A representative from a Vietnamese trading company mentioned that they were temporarily leaving the market for the National Holiday and expected improved demand for longs in September, in view of the fact that prices had reached the bottom.

Outlook: Persistent market uncertainty as well as low domestic demand are expected. Buyers are awaiting a potential price correction, although the current situation in the Japanese export market may not facilitate this. The economic slowdown in China is posing challenges for most South East Asian countries in terms of purchasing and selling scrap material.