South Korean mills have continued to raise their import scrap prices with deals concluded from Japan, while H2 bid prices have posted sharp increase from last week. At the same time, customers consider ex-US HMS I/II 80:20 scrap prices to be high and no new deals have been reported over the past week.
Hyundai Steel purchased H2 scrap from Japan at JPY 52,000/mt ($456/mt) FOB and shindachi bara scrap at JPY 67,000/mt ($587/mt) FOB. The total tonnage was 23,000 mt with shindachi bara mostly in the composition. But the producer has decided to increase its prices for Japanese scrap once again this week, with the main hike seen in the H2 segment.
Its bid for H2 grade has been raised significantly by JPY 2,500/mt ($22/mt) to JPY 54,500/mt ($478/mt) FOB. This move was interpreted as Hyundai’s desire to secure H2 scrap tonnages from Japan as demand from the local market has been strong and exporters are even more bullish now, asking for JPY 56,000/mt ($490/mt) FOB.
The competition between buyers of H2 in Asia has increased lately. Vietnamese buyers’ target prices are at $530-535/mt CFR for H2, which translates to JPY 54,000/mt FOB or slightly above, SteelOrbis understands. So South Korean buyers have had to follow. This week, Japanese sellers have increased offers to Vietnam to $550-570/mt CFR.
Despite the strong price increase in H2 bids, Hyundai has kept its shindachi bara bids stable week on week at JPY 67,000/mt ($587/mt) FOB, while it has announced its bid for shindachi press at JPY 67,500/mt ($590/mt) FOB. “Personally, I think Hyundai thought some Japanese suppliers would be able to sell shindachi at the same price as last week,” a source from Japan commented.
Indicative ex-US HMS I scrap prices to South Korea are at $550/mt CFR versus $540-545/mt CFR last week, while a South Korean buyer stated, “I am not sure if anybody is ready to accept this level right now.” There was a rumor about an US-origin scrap cargo booked by a Vietnamese steel mill consisting of bulk HMS I/II 80:20 scrap at $545/mt CFR, but the same South Korean buyer stated that this deal was denied by the buyer. Offers from the US to Vietnam are heard to be at $560-565/mt CFR.
On the other hand, South Korean mills have once again increased their domestic scrap procurement prices. On October 18, Hyundai Steel, Dongkuk Steel and Daehan Steel announced upward price adjustments by KRW 10,000-20,000/mt ($8.5-16.9/mt), depending on the mill. As a result, the weight A scrap prices of these mills respectively stand at KRW 590,000-605,000/mt ($501-514/mt), KRW 580,000-610,000/mt ($493-518/mt) and KRW 600,000/mt ($510/mt).
$1 = JPY 114.04
$1 = KRW 1,177