The weak purchasing power continues to be a challenging issue in the Vietnamese market. The prices of steel products mostly decreased this week, including a second decline in construction steel in April and Formosa reducing the price of HRC, ending the upward trend since the beginning of 2023. However, the volatility of many items such as scrap, billet, and HRC shows signs of slowing down. Nevertheless, it is difficult to assert that the market has reached its bottom due to not only weak purchasing power but also the global market, especially China, showing a decline. Therefore, price pressure in the market is expected to continue in the coming week.

Import scrap market:

The highlight of the imported scrap market this week is the significant drop in prices during the Kanto auction in April. As a result, the offered prices for scrap from Japan, the United States, the United Kingdom, or Hong Kong to Vietnam have decreased. However, import transactions remain limited, and this situation may continue in the short term.

Domestic scrap market:

The domestic scrap market continues to witness decreasing adjustments from factories, although the quantity and extent of the decrease are lower. The prices of scrap from traders also dropped by about 3.5%. While the shortage of scrap has appeared, there is still pressure due to the possibility of further reduction in construction steel.

Import billet market:

Recently, Vietnam has focused on exporting IF billet as BF billet does not attract many buyers. However, the Southeast Asian and Chinese markets are increasingly weak, resulting in a significant reduction in Vietnam's exported billet prices. Meanwhile, there have been no new import offers this week.

Domestic billet market:

The prices of domestic billets are still influenced by the decrease in scrap and construction steel this week. Although the prices decreased by 3.8% this week, it was less compared to the previous week.

Import HRC market:

The markets of India, Japan, and South Korea have temporarily stopped price offers to Vietnam. The prices of Chinese SAE 1006 and SS400 HRC to Vietnam continue to decrease slightly due to weak purchasing power, despite stable futures prices. However, there have also been limited transactions in small volumes.

Domestic HRC market:

Formosa announced a significant price reduction for HRC. This is the first monthly price reduction by Formosa since the beginning of 2023. As Formosa announced the price reduction at the end of the week and HRC futures prices increased slightly, the prices offered by traders mostly remained stable this week.

Export construction steel market:

After a long period without price offers, Vietnam's exported construction steel market recorded transactions at lower prices. However, with the decline in the Chinese market and the weakening of the Southeast Asian market, the offered prices for Vietnam's construction steel may further decrease.

Domestic construction steel market:

Steel manufacturers, starting with Hoa Phat, reduced the prices of construction steel for the second time this month, with varying decreases across products and regions. Traders reduced prices even more due to slower consumption compared to factories.

Pipe and box steel market:

Compared to the previous week, steel manufacturers announced slightly fewer official price reductions this week, resulting in a slight decrease of only 0.4% for traders compared to the previous week.

Corrugated iron market: 

There were not many price reductions announced by sheet metal manufacturers this week. However, traders took the initiative to adjust prices to stimulate demand in the context of weak market demand.

Source: Giathepton