Scrap prices in Asia climb further rapidly, mainly accepted by buyers

Friday, 27 November 2020 17:27:44 (GMT+3)   |   Istanbul
       

The uptrend in the import scrap market in Asia has continued to gather momentum over the past week, with offers and deals at higher price levels reported in Vietnam, South Korea and Taiwan. Limited offer volumes and good demand from customers in some countries like Vietnam have supported the further rise in prices.

Japanese exporters bullish, local quotes still rising

The SteelOrbis reference price for ex-Japan H2 scrap has increased to JPY 32,500-33,500/mt ($312-321/mt) FOB by the end of this week, up by JPY 1,500-2,000/mt ($14-19/mt) from the previous level. Such a rapid increase is connected with the increase in the tradable level to Vietnam to the upper end of the range, while the lower end of the range has been indicating the workable price for S. Korea.

Demand for Japanese scrap in S. Korea has been reported mainly for higher grade scrap, while no new deals for H2 have been heard. Hyundai Steel has been bidding and has managed to buy a small volume of shindachi scrap at JPY 36,500/mt ($350/mt) FOB, up by another JPY 2,000/mt ($19/mt) since last week. This price is equivalent to JPY 32,500/mt FOB for H2, though no new deals have been reported after one at JPY 31,500/mt FOB done last week for a small volume.

On Friday, November 27, Tokyo Steel, one of the major EAF-based producers in Japan, announced another price increase for one asset, Utsunomiya. At this plant, the price for H2 has been hiked by JPY 1,000/mt ($9.6/mt) to JPY 28,500/mt ($274/mt) delivered. Prices for the other four assets have remained stable at JPY 29,000-32,000/mt.

Vietnamese customers can accept higher prices from Japan and US

Offers for H2 scrap from Japan to Vietnam have increased to $350-355/mt CFR this week, up by $10-15/mt over the past week. One deal was reported at $345/mt CFR earlier this week, while at the moment bids have already reached $350/mt CFR, sources have said. “I think buyers will not have any option but to accept this [$350-355/mt CFR] price level,” a major Japanese seller said. Last week, the deal price was at $335/mt CFR for this grade.

There has also been a rumour that a cargo of ex-US HMS I/II 80:20 scrap has been sold at $365/mt CFR, but this has not been confirmed by the time of publication. Some sources have said that the latest offers have been coming at this level, but sellers have been cautious, not wanting to hurry. This price level is $15/mt higher than the tradable level last week and $20-25/mt above the previous deal prices.

Prices in Taiwan pushed up by shortage and container issue

The latest deal for ex-US HMS I/II 80:20 scrap in containers in Taiwan has been closed at $320/mt CFR, up by $10/mt from the level last week. There was a trade at $315/mt CFR earlier this week, but limited supply from the US and the shortage of containers have pushed prices up. “There is not much to buy in the market. Scrap is very expensive,” a source said.

Japanese suppliers have been offering H1/2 50:50 scrap by bulk in the wide range of $340-360/mt CFR Taiwan, versus $335/mt CFR last week. “$340/mt CFR could be tradable for those who need to purchase,” a source from Taiwan commented. No new deals have been heard so far.


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