[SMM Analysis] Indonesian HRC Low-Price Pressure Persists; Weak Steel Demand Continues Across Southeast Asia China–Indonesia Billet Spread Holds Narrow; Slab Spread Turns Positive In terms of the spread model, the China–Indonesia billet FOB spread has held within a narrow band, averaging -3 USD/t for the month (vs. a year-to-date average of -10). Some traders report that Indonesian billet offers remain relatively low, though the inversion has narrowed from the year-to-date average of -15. On the slab side, a notable recovery is underway: the monthly average spread has turned positive to +3 USD/t, a marked improvement from the half-year average of -30. Data source: SMM Southeast Asian Demand Yet to Rebound; Price Remains the "First Principle" of Order-Taking China's HRC and galvanized exports to Southeast Asia have remained weak recently, with no sign of a demand recovery at the end-user level. Downstream procurement continues to follow a "bearish wait-and-see, buy-as-needed, restock-slowly" rhythm, and order intake hinges heavily on price competitiveness. By regional competitive landscape: Indonesian material continues to move at low prices on the back of integrated industrial-park cost advantages and logistics convenience, while Vietnamese domestic mills have passively followed with covert price cuts to secure orders. By comparison, Chinese HRC offers remain relatively high, leaving exporters caught between volume and price, with no distinct edge in order-taking. By product category: Hot-rolled-substrate galvanized (hot-rolled-based HDG) coil has seen further declines in order intake under continued pressure from low-priced buy-side bids. On the demand side, although pre-stocking by some air-conditioner manufacturers has brought a marginal improvement, the drag from the construction sector remains significant, and a meaningful rebound is unlikely in the near term. On market sentiment: marginal changes are emerging — some HRC sellers have begun signaling intent to hold prices firm. With the month-end settlement window approaching, coil prices are expected to stabilize by end-August. Two key signals warrant close attention ahead: (1) the direction of Hoa Phat's monthly price adjustment for next month, and (2) whether Indonesian mills follow suit in supporting prices. Together, these will determine the pace at which the regional price center repairs in September. Copyright and Intellectual Property Statement: This report is independently created or compiled by SMM Information & Technology Co., Ltd. (hereinafter referred to as "SMM"), and SMM legally enjoys complete copyright and related intellectual property rights. The copyright, trademark rights, domain name rights, commercial data information property rights, and other related intellectual property rights of all content contained in this report (including but not limited to information, articles, data, charts, pictures, audio, video, logos, advertisements, trademarks, trade names, domain names, layout designs, etc.) are owned or held by SMM or its related right holders. The above rights are strictly protected by relevant laws and regulations of the People's Republic of China, such as the Copyright Law of the People's Republic of China, the Trademark Law of the People's Republic of China, and the Anti-Unfair Competition Law of the People's Republic of China, as well as applicable international treaties. Without prior written authorization from SMM, no institution or individual may: 1. Use all or part of this report in any form (including but not limited to reprinting, modifying, selling, transferring, displaying, translating, compiling, disseminating); 2. Disclose the content of this report to any third party; 3. License or authorize any third party to use the content of this report; 4. For any unauthorized use, SMM will legally pursue the legal responsibilities of the infringer, demanding that they bear legal responsibilities including but not limited to contractual breach liability, returning unjust enrichment, and compensating for direct and indirect economic losses. Data Source Statement: (Except for publicly available information, other data in this report are derived from publicly available information (including but not limited to industry news, seminars, exhibitions, corporate financial reports, brokerage reports, data from the National Bureau of Statistics, customs import and export data, various data published by major associations and institutions, etc.), market exchanges, and comprehensive analysis and reasonable inferences made by the research team based on SMM's internal database models. This information is for reference only and does not constitute decision-making advice. SMM reserves the final interpretation right of the terms in this statement and the right to adjust and modify the content of the statement according to actual circumstances.

[Vietnam] Mainstream Indian and Indonesian HRC offers to Vietnam remained at USD 515–520/tonne CFR. One Indian cargo was concluded at USD 515/tonne CFR this week, while another 30,000-tonne Indian cargo was booked at USD 510/tonne CFR last week. Vietnamese buyers continued bidding around USD 510/tonne CFR, though most sellers considered this level too low. Market participants remained cautious while awaiting new domestic HRC offers expected later this week or early next week.

Rising compliance costs, a verification bottleneck, and tightening EU import quotas combine to reshape the competitive landscape for Asian stainless steel suppliers in Europe from 2026 onward. The EU CBAM entered its definitive implementation phase on January 1, 2026 — transitioning from a reporting exercise into a mechanism with real trade cost implications.

[Vietnam] Indian and Indonesian HRC offers remained at USD 515-520/tonne CFR Vietnam, while SAE1006 material was offered at around USD 517.5/tonne CFR. Weak downstream demand kept most buyers on the sidelines and trading limited. Vietnamese slab export offers were stable at USD 480-490/tonne FOB.

[ASEAN] This week, the ASEAN HRC import assessment edged down to 523 USD/tonne CFR. On the import front, Indonesian HRC offers to Vietnam held firm at 520–525 USD/tonne CFR. However, with Vietnamese buyers' target prices remaining persistently low, the bid-offer gap has widened significantly. Consequently, sellers are resisting further price concessions, leaving spot trading in a stalemate. On the export front, a mainstream Vietnamese mill successfully concluded HRC sales to South Korea at 545–550 USD/tonne CFR.

[Flat products]HRC up 1 USD, deals at 489-497 USD/tonne HRC prices rose 1 USD/tonne today and other flat product export prices also rose 1 USD/tonne day on day, with HRC deals at 489-497 USD/tonne. Inquiries were fair, but actual deals were mediocre, as overseas buyers' target prices sat slightly below Chinese sellers' offers. [Billet]Export billet FOB up 1 USD to 459-462 USD/tonne Export billet prices edged up 1 USD/tonne today, with FOB offers at 459-462 USD/tonne. According to market feedback, overseas competition remains fierce while domestic mills' offers are near cost, leaving little willingness to concede further and making deals difficult. [Rebar]Rebar export offers firm, Singapore CFR at 520-525 USD According to traders, China's rebar export offers to Singapore recently clustered at 520-525 USD/tonne CFR. Some mills cut output, leaving export resources relatively limited and offers firm, but overseas buyers showed weak willingness to accept high prices, so overall deals were mediocre. [Vietnam]Domestic Mill Price Cuts Squeeze Imports as ASEAN HRC Weakens On July 6, ASEAN HRC import offers edged down to 535 USD/tonne CFR amid thin trading. Over the prior week Vietnam's two leading mills each slashed HRC ex-works prices by 33-34 USD/tonne: Hoa Phat's target price to key clients fell to 535-537 USD/tonne CIF, while Formosa Ha Tinh's September-shipment offer dropped to 546-556 USD/tonne. Formosa's official July prices, released last Friday, were cut roughly 40 USD/tonne month-on-month, quoted at 538 USD/tonne CIF for volumes above 20000 tonnes and up to 548 USD/tonne CIF for small lots, with August-September shipment. With domestic material now more competitive, Vietnamese buyers clearly favored local supply and showed little appetite for imports, forcing import offers lower: Indian HRC deals slipped to 535-540 USD/tonne CFR and Indonesian HRC to 525-535 USD/tonne CFR, both with scarce transactions. The Asian slab market softened in tandem, with local Vietnamese slab down to 490 USD/tonne FOB and Indonesian August-shipment export slab at 490-495 USD/tonne FOB. Separately, the Ha Tinh provincial government formally terminated the Thach Khe iron ore project, whose reserves total about 544 million tonnes, leaving Vietnam unable to lift domestic iron ore self-sufficiency via large-scale mine development in the near term. [Turkey]Weak Demand and Overbooked EU Quota Keep Turkish HRC Sliding On July 6, Turkish HRC prices extended their decline, weighed by limited domestic demand and a lack of alternative export outlets, with September-delivery offers down to 605-630 USD/tonne EXW. The EU quota reset brought no relief: the new quarterly HRC quota was instantly overbooked by large volumes that had arrived earlier, with third-quarter over-declaration reaching 205% and about 330000 tonnes queuing for customs clearance against a quota of roughly 160000 tonnes, further capping prices as export channels clogged. On longs, as of July 3, Turkish rebar export prices fell to 575 USD/tonne FOB on persistently weak domestic and export demand, declining mill inventories and an absence of firm orders, while HRC on an FOB basis eased to 585 USD/tonne. The domestic market remained depressed, with traders reluctant to stockpile amid tight cash flow and high borrowing costs, and no meaningful demand recovery is expected this summer. [India]Inventory Build Drags Longs as Rebar Slips While Safeguard Duty Props HRC On July 6, Indian blast-furnace (BF) route rebar prices fell about 17 USD/tonne week-on-week to around 512 USD/tonne, dragged down by a seasonal construction slowdown, rainfall, project delays and dealer inventory accumulation. Demand stayed limited to needs-based restocking, mill inventories ran at about 10-15 days, and the market expects major mills to cut long-product offers further. By contrast, HRC held firm at around 609 USD/tonne, supported by the import safeguard duty and falling import volumes, clearly outperforming longs and highlighting the divergence between flat and construction steel.