Vietnam: Imported HRC offers from China inch up w-o-w

Imported HRC offers to Vietnam from China rose by about $5/t w-o-w. The Vietnamese market has improved significantly, largely due to the positive impact of the upward trend in the Chinese market. Moreover, Vietnamese buyers are willing to accept higher prices.

Formosa Ha Tinh (FHS) has successfully sold out its latest domestic hot rolled coil (HRC) allocations for August shipments, informed a reliable source.

Imported HRC offers:

• Chinese HRCs (SAE1006) offers were heard at $585/t CFR, up by around $5/t w-o-w against $580/t CFR in the preceding week. Offers for HRCs (SS400) were heard at around $550-560/t CFR.
  
  
  
• Indian mills have stopped offering in the Vietnamese market for quite some time now.
  
  
  
• Meanwhile, no offers were heard from Japan, Taiwan, South Korea and Russia this week.
  
  

Chinese HRC futures rise w-o-w: Chinese HRC futures (October 2023 contracts) on SHFE rose w-o-w along with the increase in domestic HRC prices. Settled prices of HRC futures were at RMB 3,873/t ($541)/t) on 19 June, up RMB 92/t ($13/t) w-o-w against RMB 3,781/t ($528/t) as on 12 June.

The SHFE HRC price uptrend was seen against the backdrop of gains in futures of ferrous products and was supported by the Peoples Bank of China's announcement that it would cut its key short-term borrowing rate.

Vietnam's finished steel production in May 2023 inched up 2.3% m-o-m to around 2.22 mnt. In addition, sales of steel products increased by 13.62% m-o-m to 2.30 mnt.

Outlook
The Vietnamese steel market may see an upswing due to the recent reduction in interest rates by the central bank. However, the biggest challenge that market participants are currently facing is the lack of orders from end-users.