According to sources close to SteelOrbis, the Asian market is contending with the presence of Chinese shredded scrap availability at extremely desirable pricing along with volatility and uncertainty in the regional steel market. As such, scrap purchases are being delayed and when offers are made, they are lower than previous deals.
Japanese scrap for example is presently on bid from South Korean mills as follows (FOB Tokyo Bay, in JPY terms):
| Japanese scrap grade | Bid – South Korean mills | Latest offer heard - average |
| H2 | 24,250/mt ($214/mt) FOB | 26,250/mt ($232/mt) FOB |
| H1/2 (50:50) | 24,600/mt ($217/mt) FOB | 26,500/mt ($234/mt) FOB |
| Shredded | 26,500/mt ($234/mt) FOB | 27,750/mt ($245/mt) FOB |
| HS | 26,500/mt ($234/mt) FOB | 27,850/mt ($246/mt) FOB |
| Shindachi Barra | 27,000/mt ($238/mt) FOB | 28,500/mt ($251/mt) FOB |
| Shindachi Press | 28,000/mt ($247/mt) FOB | 29,700/mt ($262/mt) FOB |
One source stated, “Over the next few weeks, the risk and opportunities from Chinese scrap will be better understood.” The status of the recent South Korean mill bids in the Japanese market is yet unknown. Acceptance, along with the recent lower Tetsugen auction results, will clearly mark a downward direction in the Japanese scrap market as it is believed that at least one of the active South Korean bidding mills was one of the higher bidding purchasers in the recent auction.
$1=JPY 113.35, 5/12/2017