Prices for ex-Japan scrap prices have continued to move up gradually. The latest Kanto export tender has been closed with all winning bids from Vietnam, where demand has been strong and bids have improved.
On April 9, the monthly Kanto Tetsugen scrap export tender in Japan was closed at JPY 43,380/mt ($395/mt) FAS, up by JPY 404/mt ($3.6/mt) compared to last month's auction. All four lots of 5,000 mt each of H2 scrap have been sold to Vietnam. The Kanto tender average price on FAS basis translates to JPY 44,380/mt ($405/mt) FOB. With the freight from Japan to Vietnam at $50/mt minimum, this price corresponds to $455/mt CFR. Sources said that all four lots will be shipped in one vessel to lower the already-high freight costs. “In fact, on CFR basis prices [in Kanto tender] increased [compared to last week’s level]. The bulk freight to Vietnam surged to $50-60/mt; that is why the FOB price is not so high,” a source said.
Apart from this sale, some Japanese sellers reported a sale of H2 scrap at $450/mt CFR Vietnam early this week, but mentioned that by the end of the week all offers have increased to $460/mt CFR for H2 from Japan. “The strong Chinese billet market and higher sales [from Vietnamese producers] give support,” a trader said. Deal prices for billet from the ASEAN region, including from Vietnam, have added $20/mt over the week to $660/mt CFR and the latest offers are at $670/mt CFR. Though active trading in China has stopped by the end of the week, sentiment is still good and sellers plan to resume negotiations in a week or so.
Offers for ex-US HMS I/II 80:20 scrap to Vietnam have increased to $465-470/mt CFR, but no new deals have been reported so far. The tradable level has been assessed by market sources at $460-465/mt CFR at the moment.
The SteelOrbis reference price for Japanese H2 scrap has indicated a further slight increase of JPY 500/mt ($4.5/mt) compared to the middle of this week to JPY 43,000-44,500/mt ($392-405/mt) FOB. The lower end of the range corresponds to the workable price level to S. Korea, though the previous deals were at just JPY 42,500/mt FOB, as reported earlier. Overall, the ex-Japan H2 export price range has added JPY 2,500-3,000/mt ($23-27/mt) compared to last week.