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Vietnam: Slow steel market, construction activities push imported bulk scrap offers down by up to $14/t w-o-w

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Melting Scrap

BigMint Bureau

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11 Nov 2024, 19:12 IST

Vietnam: Slow steel market, construction activities push imported bulk scrap offers down by up to $14/t w-o-w

Lower demand amid slower finished steel trading

Local scrap prices stable but expected to decline next week

Japanese H2 scrap falls to $335-340/t CFR Vietnam

Vietnamese scrap importers reduced their purchasing activity this week due to slower trading of finished steel products.

Despite stable long product prices, an adjustment is expected soon.

"Japanese scrap remains competitive compared to local prices, but weak construction activity is impacting sales," said a market insider.

Japanese H2 scrap offers dropped to $335-340/t CFR Vietnam from $350-352/t in the previous week, with no new deals heard. US-origin HMS (80:20) scrap in containers was offered at $325-330/t CFR Vietnam, according to trading sources.

As per another mill source, in the middle of last week, Japan-origin H2 bulk scrap was offered to Vietnam at $335-342/t CFR, with a deal heard at $335/t.

HS-grade scrap prices softened towards the weekend amid persistent bid-offer gaps and limited liquidity. Offers for HS were $365-$370/t CFR Vietnam, with bids steady at $355/t and tradable levels between $357-360/t.

CFR Assessments

Weekly assessment for deep-sea bulk US cargoes of HMS (80:20) CFR Vietnam stood at $364/t, down $8/t w-o-w.

Weekly assessment for Japanese-origin H2, a major tradable grade in Vietnam's scrap market, was at $339-340/t CFR down by $14/t w-o-w.

According to a major trading house source in Vietnam, containerised HMS (80:20) from Australia is being offered at $320-325/t CFR Cai Mep, whereas bulk Australian material is available below $350/t CFR. However, the market typically prefers Japanese H2 over Australian scrap in bulk.

Domestic scrap demand slow

In the local market, the northern mills kept H1 scrap prices stable at VND 9,200/kg ($364/t) DDP, while rebar offers stayed at VND 13,500-13,600/kg ($534-538/t) exw. Domestic HMS bid prices were reported at VND 9,000-9,400/kg delivered to northern mills.

A major Vietnamese producer recently sold 70,000t of billets at $465-470/t FOB, according to a local source.

Outlook: Domestic scrap prices may decrease next week due to lower demand, as distributors' expectations of higher sales have not materialised. Price visibility on imported scrap offers from Japan to Vietnam is expected to be clearer after the Kanto tender on 12 November.