Local scrap purchase prices in Japan have declined on Friday, March 27, following Tokyo Steel’s announcement of a reduction of prices for all its plants. Taking into account the gap between local and export prices, most sources believe that ex-Japan scrap prices will go down further, while bids from such importers like South Korea have already decreased late this week.
On March 27, Tokyo Steel has cut its H2 scrap purchase price for all its plants by JPY 500/mt ($4.6/mt). The previous price adjustment for one asset has been done on March 11. H2 scrap prices for Kyushu and Takamatsu have come to JPY 17,500/mt ($161/mt) delivered, prices for Okayama are at JPY 18,500/mt ($170/mt) delivered. Purchase prices for the Utsunomiya and Tahara factories have declined to JPY 19,000/mt ($175/mt) delivered and JPY 20,000/mt ($184/mt) delivered respectively. The new prices are effective from March 28.
Compared to last week, ex-Japan scrap deal prices have lost JPY 500-1,000/mt ($4.6-9.2/mt) to JPY 21,000/mt ($193/mt) FOB, as SteelOrbis reported earlier this week. However, at the moment bids have already slipped to JPY 20,500/mt ($189/mt) FOB. Most sources believe that the export prices have not reached the bottom yet, taking into account lower domestic demand for steel and scrap accordingly.