Steel Industry Insight

Kanto Tetsugen scrap auction moves export H2 scrap up

The May Kanto Tetsugen scrap auction closed with the highest bids at JPY 24,600-25,000/mt ($215-219/mt) FAS for June shipment with an average bid price on the 130,000 mt at JPY 23,600/mt ($206/mt) FAS. The higher bids translated to export offers of approximately JPY 26,000/mt ($227/mt) FOB Tokyo Bay.

By May 17, the H2 export scrap market had moved down, with South Korean mills heard placing soft bids at approximately JPY 23,000-23,400/mt ($207-211/mt) FOB Tokyo with export offers at JPY 24,000-24,700/mt ($216-223/mt) FOB Tokyo Bay or $240-245/mt CFR Taiwan.

During the June scrap auction, H2 scrap was sold at an average price of JPY 25,525/mt ($232/mt) FAS. The price moved up JPY 725/mt ($15/mt in dollar terms due to exchange rate fluctuations) from the average selling price of JPY 24,800/mt ($217/mt) on the higher bids in the May auction.

Export offer prices for Japanese H2 scrap in bulk cargoes moved up to $265-275/mt CFR Taiwan during the June auction; traditionally this translates to $245-255/mt CFR Taiwan containerized HMS I/II 80:20. Given the strength in the Japanese domestic scrap market, export scrap prices are expected to continue trending up. In turn, the US export containerized HMS I/II 80:20 scrap market is expected to continue to firm. The most recent deals have been heard at $245-250/mt CFR Taiwan with rumors of recent low volume deals closing at $250-252/mt CFR Taiwan.

$1=JPY 114.27, 5/10/2017
$1=JPY 110.95, 5/17/2017
$1=JPY 109.81, 6/12/2017


*This was published on SteelOrbis website on June 12, 2017.

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