Vietnam’s Hoa Phat Dung Quat has lowered its domestic hot rolled coil (HRC) prices, responding to ongoing market weakness. On January 2, the company announced a price reduction for non-skin passed SAE1006 or SS400 grade HRC for March/April shipments, setting the price at approximately $519/tonne cfr southern Vietnam, excluding VAT. This marks a decline from the previous official price of $527/tonne cfr announced last month. In Vietnamese dong (VND), the new price stands at VND 13,220/kg for southern Vietnam, a decrease of VND 150/kg from last month’s official price. The mill has also reduced its prices for northern and central Vietnam to VND 13,190/kg cfr.
The price cut reflects the ongoing weakness in demand within the local market, as acknowledged by traders in Hanoi. One trader remarked that the reduction is likely a response to low domestic demand. Moreover, the price adjustment could be strategically aimed at putting more pressure on Hoa Phat’s domestic competitor, Formosa Ha Tinh Steel, as the market competition intensifies. The steel industry in Vietnam has been facing challenges as demand remains subdued, and companies like Hoa Phat are taking measures to remain competitive in an uncertain environment.
This price reduction by Hoa Phat is expected to have a ripple effect on the local market, influencing not only steel producers but also buyers who are navigating a difficult market. With demand not showing significant improvement in the short term, the price adjustment could be a crucial step for Hoa Phat to maintain its market position while responding to the broader market slowdown.
