The Vietnamese hot rolled coil market is seeing an uptick in prices, Kallanish notes. Chinese HRC prices have gone up and local producer Formosa Ha Tinh (FHS)’s latest domestic prices are providing some support to the market.

Chinese 2mm and up thickness SAE 1006 HRC offers are prevailing at $560/tonne cfr Vietnam, Vietnamese trading sources. A popular Chinese mill’s offer for 50% 2mm thickness and the rest above 2mm thickness was pegged on Friday morning at $560/t cfr Ho Chih Minh (HCM)/Hai Phong port, for January 2023 shipment. Chinese SAE 1006 HRC offers were previously at $550-560/t cfr on 11 November. Offers had sunk to recent lows of $500-510/t cfr in early November.

A Vietnamese trader hears that a leading re-roller in southern Vietnam ordered 10,000 tonnes of Taiwanese SAE 1006 2mm and up thickness HRC at $550/t cfr on 17 November. However, others did not hear of the deal and expressed surprise about it taking place. The buyer would be better off buying FHS's material, they explain.

“I wonder why they didn’t book FHS to avoid any exchange rate change,” a trader in HCM says. FHS announced on 17 November that its sales price for non-skin-passed SAE 1006 HRC will be set at the equivalent of $550/t cfr Vietnam. Freight to Ho Chi Minh is $10/t, trading sources say. “If the Taiwanese mill gave thin gauges in the cargo, then the deal is possible,” a trader in Hanoi says. He believes demand from re-rollers is returning. While inventories for SS400 grade HRC are still high, SAE 1006 HRC stocks are "so-so”.

"I have my doubts," a regional trader says. He also believes that for the Taiwanese HRC deal to take place, it would have to involve "thin sizes and odd width, otherwise they can buy Formosa”. Imported HRC may be priced $10/t lower than local strip in order to make import deals workable.

The regional trader and others hear that FHS sold large export tonnages of HRC to India and the EU at around $510-520/t fob during the week ending 11 November. The mill’s new target export price is at $530-535/t fob, the Hanoi trader says.

Kallanish assessed SAE grade 2-2.7mm thickness HRC at $530-540/t cfr Vietnam, up $10 on-week.