The weakening sentiment in the global scrap market has impacted Japanese exporters. New deals have been reported, to S. Korea in particular, at lower price levels for H2 scrap, while prices of higher grade scrap are firm so far, SteelOrbis has learned.
Ex-Japan H2 scrap has been sold to Dongkuk Steel at JPY 41,000/mt ($376/mt) FOB, JPY 1,000/mt ($9/mt) below last week’s bid from another large importer in South Korea, Hyundai Steel. About 20,000 mt of scrap has been booked, according to sources, though many exporters have not been willing to cut prices and have continued to ask for higher prices.
In addition, the Kansai export tender for 5,000 mt of H2 scrap has been closed at JPY 39,950/mt ($367/mt) FAS, and, though it is still higher than the result of an auction last month, it is JPY 3,026/mt ($28/mt) below the Kanto tender price level released last week. The Kansai auction price corresponds to JPY 40,950/mt ($376/mt) on FOB basis.
Vietnamese customers have also been asking for discounts for ex-Japan H2 scrap, willing to pay only below $440/mt CFR, while last week some bookings were done at $440-450/mt CFR.
As a result, the SteelOrbis reference price for ex-Japan H2 scrap has been lowered to JPY 41,000-43,000/mt ($376-394/mt) FOB, down by JPY 1,000/mt ($9/mt) compared to the previous week.
In the local market in Japan, scrap prices have also continued their decline. Tokyo Steel, the main EAF-based steel producer in the country, has announced a scrap purchase price decrease for two out of five of its assets on March 16. The price for H2 has been lowered by JPY 500/mt ($4.6/mt) at Okayama and Takamatsu to JPY 40,500/mt ($371/mt) and JPY 39,500/mt ($362/mt) respectively. Prices at the Utsunomiya plant have remained at JPY 41,500/mt ($380/mt), while at the Tahara Works and the Kyushu Works they have stayed at JPY 42,000/mt ($385/mt) and JPY 41,000/mt ($376/mt), respectively. All prices are delivered and effective from March 17.