The results of the Kanto export tender in Japan closed today, January 12, are in line with the positive expectations in the market, as the average price level in the auction has exceeded JPY 50,000/mt FAS, boosting the mood in the local market further, while also supporting expectations that higher levels will be accepted in major overseas sales destinations in the short term.
The Kanto tender average price has reached JPY 50,932/mt ($385/mt) FAS, up by JPY 3,364/mt ($24/mt) from December. The dollar equivalent has increased by an even larger margin - by $39/mt, owing to the appreciation of the local currency in Japan over the past month.
In total, 11,000 mt of scrap have been traded with one lot of 6,000 mt of H2 at JPY 51,030/mt ($386/mt) FAS, while another lot of 5,000 mt has been traded at JPY 50,815/mt ($384/mt) FAS. According to market sources, the expected trading destination for these volumes is Vietnam.
The Kanto tender FAS price translates to JPY 51,932/mt or $393/mt FOB.
The tradable levels for Japanese scrap in South Korea have been lagging slightly behind, but market sources believe than Hyundai Steel’s H2 bids should be above JPY 50,000/mt FOB at least to attract any volumes, versus bids at JPY 49,000/mt FOB on December 27.
The latest deals for Japanese scrap in South Korea have been done by POSCO with the HS price at JPY 58,000/mt ($439/mt) CFR, shredded scrap at JPY 56,650/mt ($429/mt) CFR, and a shindachi press deal at JPY 56,500-57,000/mt ($427-431/mt) CFR.
Offers for ex-US HMS I scrap to South Korea have been reported at $425/mt CFR.
The SteelOrbis reference prices for ex-Japan H2 scrap settled at JPY 50,000-52,000/mt ($378-393/mt) FOB, up by approximately JPY 1,000-2,000/mt ($8-15/mt) on average over the past week and almost JPY 3,000/mt ($23/mt) over the past two weeks.
