Posted on 19 Jul 2019
Vietnam’s Formosa Ha Tinh is planning to sharply hike its domestic hot rolled coil prices, Kallanish understands.
The mill’s official release of its new domestic prices is expected at the end of this week. However, market sources have heard directly from the mill’s sources that the sole domestic strip producer will hike prices by $25/tonne for September shipments. The mill did the reverse last month and cut prices by $25/t for August shipments.
The steelmaker’s base SAE1006 HRC will increase to $541/t cif, while SPHT3, S235JR, SG255 and SS490 has been raised to $561/t. HRB without skin pass has been cut to $536/t cif. The company maintained its $5/t discount for SS400 and for pipe-making grades.
Market sources were expecting a price increase because of firmness in iron ore. But the hike is higher than anticipated because import prices are lagging behind. A Vietnamese trader says that he is “…confused” because he does not think that the mill would be able to sell material at this high price. He prefers to wait for the official price announcement by the mill.
Last week, Chinese offers for 2-2.5mm thickness SAE 1006 re-rolling grade HRC were prevailing at $515-520/t cfr Vietnam. Japanese SAE 1006 HRC was offered at $525/t cfr Vietnam while traders’ position cargoes of Indian SAE 1006 HRC for end-July/early-August shipments concluded at $510-515/t cfr Vietnam.
A Chinese trader thinks that the mill could always make some concessions and give out refunds if it cannot get enough sales. Chinese HRC prices are moving up, he says. Chinese SS400 HRC offer prices are current prevailing at $520/t cfr Vietnam against bids of $505/t cfr Vietnam, he adds.
Formosa also hiked its wire rod prices by $5/t. GCWQ was cut to $559/t cif, MQ to $545/t and MQ2 to $527/t. The company sells domestically on a cif basis because of the customs status of the plant.
