Vietnam-based Formosa Ha Tinh Steel has increased prices for July deliveries of finished flat and long products by $10-20/mt following trends in global HRC prices. Despite the rise, the company states it has held offers lower than expected due to the prices offered by steelmakers in China, India, South Korea. The company has also lowered export allocation by up to 50pc of usual monthly sales for July shipments.
Revised offers by the company are higher by $10-20/mt than the May levels. For June shipments, the steelmaker had stayed away from releasing its prices officially amid a sharp drop in spot market prices on the back of COVID-19 outbreak. Production by many steelmakers across the world had come to a halt.
According to Davis Index source in Formosa, new prices for July shipment of base HRC (SAE 1006/SPHC/SPHT1) would be at $440/mt cif or VND10,230/kg for re-rollers. Pipe making coils and HRC (SS400) prices are at $430/mt cif. For HRC specified under SS490, SG255 July shipment prices are $460/mt cif and those for without skin pass hot-rolled bands at $435/mt cif, up by $16/mt from the prior set of prices.
Chinese HRC export offers rose to $450/mt cfr Vietnam last week, up by $10-15/mt. Barring China, HRC prices in other countries, like Japan, South Korea and Taiwan did not increase significantly.
Indian HRC exporters traded around 40,000-50,000mt HRC in the range $425-435/mt cfr Vietnam. But Chinese exporters are now under pressure with the stimulus package proving to be a disappointment. China government’s failure to set GDP targets in ‘two sessions’ meeting has also added to their woes.
Vietnamese HRC importers expect softness in prices to persist following Japanese and South Korean trends. Mills in Vietnam slowed production awaiting clarity on market direction. The capacity utilisation rate for Formosa steel is also likely to be low in June.
Formosa’s prices for wire rod remained unchanged around $470‑490/mt cif depending on the specifications. MQ rods at VND11,190/kg or $481/mt, MQ2 at VND10,960/kg or $471/mt and GCWQ rods at VND11,420/kg or $491/mt on cif basis.