As anticipated by SteelOrbis, South Korean producer Hyundai Steel has reduced its bids for Japanese scrap. Due to healthy domestic scrap flow and ongoing declines in local scrap prices, South Korean mills were planning price reductions for import scrap, mainly Japanese H2, which is largely considered to be expensive as compared to its alternatives. In the meantime, Japanese mills are also cutting their domestic scrap procurement prices, starting with Tokyo Steel, as in the absence of foreign buyers there is no competition.
SteelOrbis has learned that Hyundai Steel has shared a bid for Japanese H2 grade scrap at JPY 49,800/mt ($379/mt) FOB. The previous bid from Hyundai Steel for Japanese H2 scrap was announced on March 22 at JPY 52,300 ($401/mt - with the exchange rate at 130.29 to the dollar) FOB. Considering the fluctuation of the exchange rate, Hyundai Steel’s bid has indicated a $22/mt fall on dollar basis.
On Tuesday, April 4, Tokyo Steel’s general range for H2 grade scrap moved down to JPY 50,500-52,500/mt ($380-396/mt), depending on the mill with the exchange rate at JPY 132.75 to the dollar. The dollar-based prices have decreased by $10/mt as compared to the previous levels announced on March 28.
As a result, the SteelOrbis reference prices for ex-Japan H2 scrap have moved down from JPY 50,000-54,500/mt ($374-408/mt) FOB to JPY 49,800-52,000/mt ($378-396/mt) FOB. The lower end is now represented by Hyundai Steel’s most recent bid today, while the upper end of the range is represented by the offers from Japan to Vietnam.
Hyundai Steel has also reduced bids for HS scrap by JPY 3,000/mt or $27/mt to JPY 53,300/mt ($405/mt) FOB as compared to the levels on March 24.
Meanwhile, Hyundai Steel’s bids for HMS I/II 50:50 scrap stand at JPY 50,300/mt ($383/mt) FOB, down JPY 2,500/mt or $22/mt from the previous bid.
$1 = JPY 131.48