Prices for Japanese scrap in the latest Kanto export tender have increased visibly, in accordance with expectations. The Kanto auctions were canceled for two months in a row in November and December due to low bids. But this time the auction has been successful as the mood in the export market has improved and the gap with local prices is lower due to some slowdown of demand in Japan.
The first lot of 5,000 mt of H2 scrap has been awarded at JPY 51,010/mt ($442/mt) FAS, while the second one for 5,100 mt has been sold at JPY 50,957/mt ($442/mt) FAS. Accordingly, the average price has been at JPY 50,983/mt FAS, while last month the highest bid was at JPY 50,000/mt ($433/mt) FAS.
The current FAS price in the Kanto tender corresponds to JPY 51,983/mt ($451/mt) FOB.
The tender results are expected to bolster prices in the next deals to South Korea and Vietnam. The SteelOrbis reference price for ex-Japan H2 scrap has been at JPY 49,000-50,000/mt ($411-428/mt) FOB since late last week, increasing by JPY 1,500/mt ($13/mt) on the back of expectations and higher sales to Vietnam.
“The price to Turkey is going up and so is the domestic market in Korea... We may be in the market after the Kanto tender,” a South Korean importer told SteelOrbis on January 11.