South Korean mills have cut their bids for ex-Japan scrap, supporting the idea that Japanese scrap prices are losing strength in the Asian markets. South Korean mills have maintained their local prices unchanged.
Hyundai Steel has reduced its bid for ex-Japan H2 grade by JPY 3,000/mt ($26/mt) as compared to the levels announced on October 21, to JPY 51,500/mt ($452/mt) FOB as the pressure on Japanese scrap increases both locally and abroad. This price is JPY 500-5,500/mt ($4-48/mt) lower than Tokyo Steel’s domestic prices for the same grade. Since Japanese exporters are able to sell at JPY 54,000/mt and slightly above in the local market, it is not clear what tonnages Hyundai Steel may secure with such a low bid.
It is also heard that Daehan Steel has bid for Japanese H1/2 50:50 scrap at JPY 57,500/mt ($505/mt) CFR this week, which translates to around JPY 52,000-52,500/mt ($456-461/mt) FOB for H2.
As a result, the SteelOrbis reference price for export H2 scrap from Japan has been lowered to JPY 51,500-54,000/mt ($452-474/mt) FOB from JPY 54,000/mt FOB earlier this week. The lower end of the range corresponds to Hyundai Steel’s bid, and the higher end to the price levels to Taiwan and Vietnam and their local equivalents.
Hyundai’s bids for HS and shredded scrap have also moved down, but by a lower margin, by JPY 2,000/mt ($18/mt) to JPY 59,000/mt ($518/mt) FOB and JPY 58,000/mt FOB ($509/mt), respectively. The producer decreased its bids for shindachi bara by JPY 1,500/mt ($13/mt) to JPY 65,500/mt FOB ($575/mt) FOB. Hyundai Steel has bought Japanese scrap at the abovementioned levels, though SteelOrbis has learned that the mill decided to refrain from shredded and shindachi bara purchases this time.
Meanwhile, POSCO’s bids for Japanese shindachi press grade scrap are at JPY 70,500/mt ($619/mt) CFR, translating to JPY 66,500/mt ($584/mt) FOB. POSCO has not announced its new bids for shredded scrap.
While no offers from the US to South Korean buyers heard, SteelOrbis has learned that offers from the US to Vietnam for HMS I/2 80:20 scrap are at $550-560/mt CFR, while bids are hardly above $545/mt CFR.
$1 = JPY 113.87