During the June Tetsugen scrap auction two weeks ago, Japanese H2 scrap sold at an average of JPY 25,525/mt ($232/mt) FAS. However, a large South Korean steelmaker continued steadfastly with bids of JPY 24,000/mt ($219/mt) FOB Tokyo bay through the month. Expectations of price erosion throughout the month given general market uncertainty did not become a reality, and as a result, the same steelmaker has raised its bid price for H2 scrap this week by JPY 2,000 to JPY 26,000/mt ($234/mt) FOB this week. Export offers of H2 are presently heard at JPY 27,000-28,000/mt ($243-252/mt) FOB Tokyo Bay. To Taiwan and South Korea, H2 offers were approximately $265/mt CFR.
According to sources, this upward movement in the bid price from a prominent South Korean mill along with recent purchases by steel mills in Bangladesh and India from the US West coast is supporting increases in ex-West coast scrap prices. The US East coast scrap export market is also facing positive expectations due to recent Turkish import scrap deals from the Baltics that point to the possibility of US origin HMS I/II 80:20 scrap moving closer to $285-290/mt CFR Turkey in future deals. Ex-US offers for containerized HMS I/II 80:20 are generally at $255-260/mt CFR Taiwan and South Korea.
$1=JPY 109.81, 6/12/2017
$1=JPY 111.27, 6/22/2017