The downtrend has continued and gathered momentum in the import scrap market in Taiwan over the past week. Suppliers have cut prices by $25-30/mt since last week to attract customers, but buyers have been cautious in purchases, expecting a further decline next week.
Ex-US HMS I/II 80:20 scrap in containers has been offered and traded at $405/mt CFR late this week, down by $25/mt compared to a week ago. Negotiations have been heard at $400/mt CFR on Friday. “Prices for US HMS 80:20 scrap surged by $120/mt in December. This month a drop by at least a half of that amount - $60/mt - will be reasonable,” a steel mill source from Taiwan said. For now, prices have lost $45/mt in total over the first weeks of January, and so sources believe that a further $15/mt decline will be seen in the coming week.
Japanese suppliers are also aggressively cutting prices as buyers from major countries like S. Korea and Vietnam have been holding off purchases of H2 and H1/2 scrap from Japan recently, while the local market in Japan has also weakened. The latest deal for ex-Japan H1/2 50:50 scrap by bulk has been signed at $410/mt CFR this week, down by $25-30/mt from last week. “The difference in prices [between ex-US and ex-Japan scrap] narrowed to $5/mt, so it is a good time to buy Japanese scrap now,” a source said.
Nevertheless, market sources believe that customers in Taiwan will prefer to buy cheaper lower quality Japanese scrap, as demand for higher grades like shredded, HS and shindachi is higher in Asia and due to the competition between buyers prices may not be so attractive.