The past week marked the return of Chinese hot rolled coil price competitiveness in Vietnam. Market sentiment dived after traders started offering cargoes for forward delivery at low prices.

A Chinese mill’s export sale for SS400 grade 2.3mm and up thickness HRC at $850/tonne cfr Ho Chi Minh City surprised Vietnamese market sources. The deal for 30,000 tonnes was to a Vietnamese trader/stockist, and was probably for January shipment, a Chinese trader reports. 

A Vietnamese trader was surprised that the Chinese mill accepted “such a low level” because it indicates that the mill dropped prices quickly. He also heard a fresh offer for Chinese-origin SAE 1006 HRC for January shipment at $865/t cfr Vietnam.

But another Vietnamese trader is sceptical that buyers will accept $850/t cfr. Buyers are holding back because of market chatter that domestic mill Hoa Phat will soon be releasing its new domestic allocations for January shipments at $850/t cfr. He hears that a Vietnamese re-roller ordered 5,000-10,000t of HRC, for shipment by mid-January, from a new Indonesian entrant at $810/t cfr. Traders are also offering SAE 1006 HRC from either China, India or Russia for April shipment at only $765/t cfr, he points out.

A pre-sale for 5,000-10,000t of 3-12mm thickness Chinese-origin SS400 HRC for February shipment concluded at $810/t cfr Vietnam on Friday, the first Chinese trader reports. But there is still no clarity on when a widely-rumoured forthcoming export tax on Chinese HRC will be implemented. A Vietnamese trader says he expects "friendly negotiations will take place if it happens during shipment".

For January shipments, importers are targeting to book SS400 grade HRC at $830-840/t cfr and SAE 1006 HRC at $850/t cfr, a Vietnamese mill manager says. Kallanish lowered its SAE 2-2.7mm thickness HRC assessment on Friday to $855-860/t cfr Ho Chi Minh City, down $17.5 on-week.

Meanwhile, hot-dip galvanised coil prices have also fallen in Southeast Asia. Offers for Z80 1mm base HDG from China are prevailing at $985/t cfr Manila, down from $1,020/t during the last week of October. “There are a few orders being booked here and there but mostly for thinner gauges,” a Manila trader said on Friday.