Import scrap activity has increased in South Korea recently as customers have decided to replenish stocks after a break in purchases, seeing lower prices. As a result, there have been deals for scrap of all major origins - ex-Japan, ex-US and ex-Russia.
A cargo of scrap from the US, consisting of 20,000 mt of HMS I/II 80:20, 10,000 mt of bonus grade and 15,000 of shredded scrap, was sold to South Korea late last week. According to the deal, the price of HMS I, which is the benchmark in the South Korean market, has been assessed by market participants at $287.5/mt CFR. Arrival of the cargo is scheduled for April. Though there was no transaction for ex-US scrap in South Korea for a long time, in the middle of Jnuary the indicative price level for ex-US HMS I was at $295/mt CFR, sources said.
There have also been reports that Russian A3 scrap has been traded at close to $280/mt CFR South Korea, but this information has not been confirmed by the time of publication. The previous deal for ex-Russia scrap was at $292/mt CFR in early January.
At least two South Korean mills bought ex-Japan H2 scrap last week. In total, about 27,000-30,000 mt of H2 changed hands at JPY 25,500/mt ($234/mt) FOB, which corresponds to $255-260/mt CFR. This price level is in line with offers heard earlier, following announcement by exporters of a JPY 500/mt ($4.6/mt) decrease in the middle of the month. However, another price decrease for ex-Japan scrap is expected in the near future, sources said.
