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Vietnam scrap buyers withdraw in falling market

Jan 15, 2021 | 08:31 AM | Singapore | Paul Lim

Tags  Vietnam, Taiwan, ferrous scrap, bulk, containerized, heavy melting scrap, H2, Shindachi busheling


Ferrous scrap buyers started withdrawing from the spot market in key importing country Vietnam during the week to Friday January 15 due to growing sentiment of a downward price trend, market sources told Fastmarkets.

Offers for Japanese H2 were at $460 per tonne cfr southern Vietnam and $465 per tonne northern Vietnam compared with bids at $450-455 per tonne cfr Vietnam.

But buyers remained wary amid expectations of more price declines.

“Given the current price trend, it is much better to wait and see,” a buyer source in Vietnam told Fastmarkets.

Bids for bulk Japanese H1&H2 (50:50) were at $460-465 per tonne cfr Vietnam and offers were at $470 per tonne cfr Vietnam before the Kanto Tetsugen auction results.

Market sources feel a definite downward price trend has started and are not looking actively to purchase cargoes.

A major South Korean steel mill had lowered its bid for Japanese scrap, looking for H2 at ¥42,000 ($404) per tonne fob this week, causing sentiment to weaken in Asia. It also bid for HS and shredded scrap at ¥46,500 per tonne and Shindachi Bara at ¥47,500 per tonne.

Major Japanese mini-mill Tokyo Steel had also lowered its bid for ferrous scrap at its Utsunomiya plant by ¥1,000 per tonne to ¥42,000 per tonne.

“These have caused collection prices in the Tokyo Bay area to fall further to ¥40,000-41,000 per tonne,” a Japanese trader told Fastmarkets on January 14.

Buyers said they received offers for bulk Japanese HS at $482-483 per tonne cfr Vietnam.

Hong Kong-origin H1&H2 (50:50) was offered at $455-460 per tonne cfr Vietnam.

Domestic scrap in thicknesses of 3mm and less was being sold at 9,000-9,200 Dong ($389.40-398.05) per kg.

Fastmarkets’ weekly price assessment for steel scrap H2, Japan-origin import, cfr Vietnam was $450-460 per tonne on Friday, widening downward by $10 per tonne from $460 per tonne a week earlier.

Offers for bulk cargoes of HMS 1&2 (80:20) from the United States fell continually throughout the week.

While traders said offers were at $490 per tonne cfr Vietnam mid-week, with bids at $480-485 per tonne cfr Vietnam, buyers said they had received offers at $480 per tonne cfr Vietnam for HMS 1&2 (80:20), at $485 per tonne cfr Vietnam for shredded and $490 per tonne cfr Vietnam by Friday.

Bids also fell to $473 per tonne cfr Vietnam by Friday.

Estimates that market prices were at $485 per tonne cfr Vietnam earlier in the week were no longer valid, sources said.

Fastmarkets’ weekly price assessment for deep-sea bulk cargoes of steel scrap, HMS 1&2 (80:20), cfr Vietnam was $473-480 per tonne on Friday, down by $5-12 per tonne week on week from $485 per tonne.

Containerized cargoes were offered at $445 per tonne cfr Vietnam, with bids at $440 per tonne cfr Vietnam in the earlier part of the week.

A transaction at $440 per tonne cfr Vietnam for US-origin material was heard concluded on Thursday. Market participants said negotiations for containerized cargoes were mainly at $440-445 per tonne cfr Vietnam.

Explore the six macroeconomic and steel-specific dynamics set to rebalance the Asia steel and scrap market in 2021. Please read our full report Asia Steel and Scrap: Six Key Forces in 2021 today.


 

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