A steep but firm reversal in steel and raw material prices appears to have encouraged Japanese scrap suppliers to become more flexible in negotiations with Chinese customers. The latter, in their turn, have remained persistent in voicing lower bids, aiming to take advantage of the prevailing bearish sentiments in the global market. Furthermore, reduced production costs in iron casting following the decrease in feedstock prices, in particular, for metallurgical coke and iron ore, have also emboldened EAF-based steelmakers in China to seek lower prices.
Accordingly, following a long absence of any trading, by the end of the current week information about one booking of ex-Japan HS scrap to China has leaked to the market. The deal is said to have been done for 3,000 mt of HS scrap, for June shipment, at $525/mt CFR. Another cargo is reported to have been sold at $480/mt CFR, for a 3,000 mt lot. However, some market sources doubt this. “I would book at such a price with great pleasure, but there is nobody who is offering it,” a Chinese trader stated.