Japanese scrap exporters have increased their prices significantly this week, which has been supported by higher bids from S. Korea and Vietnam.
The SteelOrbis reference price for ex-Japan H2 has reached JPY 50,000/mt ($457/mt) FOB, increasing by JPY 4,000-5,000/mt ($37-46/mt) since last week. The higher prices have been released in the market after the Kanto tender on May 11.
Late this week the major importer from S. Korea, Hyundai Steel announced its new bids for Japanese scrap. Its new price for H2 has reached JPY 50,000/mt ($457/mt) FOB, up by JPY 7,000/mt ($64/mt) compared to the previous bid, made in the middle of April. According to sources, some other buyers from S. Korea have been ready to purchase at a similar level.
In addition, bids of Hyundai Steel for shredded, HS and shindachi have also increased by JPY 7,000/mt to JPY 54,000/mt ($494/mt) FOB, JPY 55,000/mt ($503/mt) FOB and JPY 56,000/mt ($512/mt) FOB respectively.
In Vietnam, prices for ex-Japan H2 scrap have hit and exceeded a $500/mt CFR mark. Two lots of 5,000 mt each from the Kanto tender will be shipped to Vietnam, according to sources. The deal prices have been at about $460/mt FOB or at least $510-520/mt CFR. A number of customers from Vietnam have not been ready to accept such a sharp increase as last week a deal price level was at $480/mt CFR. Nevertheless, importers will need to pay a minimum of $500-510/mt CFR for ex-Japan H2 to attract any volumes, according to sources.
Next week the uptrend may ease, sources believe, as billet prices will correct downwards for some extent. “Billet prices [from foreign suppliers] are higher than domestic rebar prices in many Asian countries now,” an Asian source said.
In the local Japanese scrap market, the uptrend has continued. On May 14, Tokyo Steel announced another round of scrap purchase price increase – by JPY 1,000/mt ($9/mt) for all five of its assets. The prices for H2 scrap at the Tahara Works, Okayama and Kyushu are at JPY 50,000/mt ($457/mt), JPY 49,000/mt ($448/mt) and JPY 48,500/mt ($443/mt), respectively. The Kanto area-based Utsunomiya has witnessed an increase to JPY 47,000/mt ($430/mt). All prices are delivered and effective from May 15.