Japanese scrap exporters have cut prices for major customers in Asia even despite no visible changes in the local market. Weak sentiment following sharp steel price drops in China has remained the main negative factor in the scrap segment this week.
The SteelOrbis reference price for ex-Japan H2 scrap has dropped by JPY 2,000/mt ($18/mt) over the past week, coming to JPY 46,500-47,000/mt ($422-427/mt) FOB.
As SteelOrbis reported earlier this week, Dongkuk Steel, one of the major buyers in S. Korea, was bidding at JPY 47,000/mt FOB and at least 10,000 mt of H2 were sold at this level, sources have said. This is JPY 2,000/mt or $18/mt below last week’s bid from Hyundai Steel.
In Vietnam, offers from Japan for H2 have dropped to $490/mt CFR and slightly above, versus $510/mt CFR a week ago. A deal has been reported at $480/mt CFR this week and some sources have started to bid at $470/mt CFR maximum late this week. “Billet prices are falling so rapidly that mills are not ready to purchase scrap now,” a source from Southeast Asia said.
In Taiwan, offers for H1/2 50:50 from Japan have dropped by $20/mt over the past week to $475/mt CFR, but are still too high for customers.
In the higher grade scrap segment, the market has not been active either. Offers for HS from Japan have been heard at $530/mt CFR to both Vietnam and China. But importers in China have been ready to consider prices not above $490-500/mt CFR. The only deal for HS scrap has been heard to S. Korea at around JPY 57,000/mt CFR or $510/mt CFR, almost similar to the bid of Hyundai Steel for this grade last week.