Posted on 27 Nov 2018
Bulk ferrous scrap cargoes arriving in Vietnam are facing discharging delays, Kallanish notes. Tightened regulatory measures surrounding the import of ferrous scrap enforced in end-October saw a backlog of bulk cargoes starting earlier this month.
The clearance of bulk cargoes now requires approval from six regional departments of Vietnamese government ministries including the Ministry of National Resources & Environment and Ministry of Industry & Trade. Previously, Vietnamese Customs was the only entity clearing ferrous scrap imports.
Market participants say the delays are mainly due to the unfamiliarity of the new regulatory bodies with dealing with ferrous scrap. “It will take a while since the checks and approvals for the first few cargoes which are affected in early November,” says a manager with an importing steel mill in southern Vietnam. “It will get better with time,” he adds. Previously, container ferrous scrap cargoes were held up after increased checks on containers of scrap of all materials.
Meanwhile, the scrap import market remained sluggish in Vietnam. Weak finished steel demand and declining Asian scrap prices have depressed buying. Last week, Japanese H2 scrap was heard offered at $325/tonne cfr Vietnam, down from $330/t cfr earlier last week and around $350/t cfr at end-October. Hong Kong scrap was down to $318-320/t cfr last week compared to $340/t cfr at end-October.
Billet is softening and was last week dragged down by the emergence of Chinese billet exports to the region. Domestic blast furnace billet prices are prevailing at around $470/t cfr Vietnam levels and Vietnamese mills have been considering this as a more competitive alternative to running their meltshops.
