Vietnam: Imported scrap offers fall to over three-month lows on subdued market sentiments

Vietnam's imported scrap offers fell to their three-month lows amid subdued market sentiments. The market was mostly quiet due to dull finished steel demand from domestic and overseas buyers. On the other hand, considering the inconclusive Japanese Kanto scrap export tender - due to lower bids, suppliers are not ready to cut their offers for Japanese H2 material. Hence, the Vietnamese buyers are less interested in booking fresh materials at high offers.

• Fresh offers for bulk Japanese H2 scrap dropped further by $40/t to $510/t CFR Vietnam over a week. Prices hovered at over three-month lows on subdued market sentiments.
  
  
• Bulk offers for HMS 1&2 (80:20) from the US were at $510-515/t CFR, down by around $40/t from last week.
  
  

In the absence of Vietnamese buyers, US suppliers prefer to trade with Bangladesh mills. Mills actively secured around three bulk US cargoes, SteelMint understands.

Furthermore, industrial production in April was estimated to increase by 2% over the previous month due to the control of the Covid-19 pandemic, trade being more proactive in terms of labour and production plans. Generally, in the first four months of 2022, the industrial production index increased by 7.5% over the same period last year, as per the Vietnam Steel Association (VSA).

Production and sales fall in April 2022

• Finished steel production reached 2.962 mnt in April 2022, down 11.28% compared to March 2022 and down 1.1% over the same period in 2021.
  
  
• Sales of all kinds of steel reached 2.419 mnt in April 2022, down 22.52% over the previous month and down 15.6% over the same period a year ago.
  
  

Vietnam's billet export offers down: Vietnam's BF-route billet export offers stood at $695/t FOB, a w-o-w drop of $15/t. Weak buying interest, falling prices of raw materials, and domestic scrap continue to weigh down offers.

Ferrous scrap imports rebound 48% m-o-m in Apr: Vietnam recorded imports of 0.43 mnt of ferrous scrap in April 2022 against 0.29 mnt a month ago, a significant hike of 48% m-o-m. Imports rebounded amidst a lower base in March 2022 due to Covid. Japan continued to be the largest supplier at 0.16 mnt followed by the US with 0.08 mnt. However, on a y-o-y basis, the country's imports fell by 22% from 0.55 mnt in April 2021, as per data maintained with SteelMint.

Imports rebounded amidst a lower base in March 2022 due to Covid. Also, steel demand in Vietnam is gradually recovering with the resumption of several construction and infrastructure projects, especially the large public investments.

Other market overview

• Indonesia: The most preferred PNS material of UK origin was being offered at $550/t CFR levels, last week. While the HMS 1&2 (90:10) quoted at $535/t CFR levels.
  
  
• Thailand: Central America-origin HMS 1&2 (70:30) was offered at $445-450/t CFR levels during last week. Offers have come down by $30/t w-o-w on limited demand and low bids from end-users.