Taiwan’s import scrap market has continued its downtrend unabated. “Prices are collapsing everywhere,” a source at a major Taiwanese mill commented, adding, “From now on, the price will soften further every day, as decrease expectations mean market players are refraining from trading.”
Ex-US HMS I/II 80:20 scrap in containers are offered to Taiwan at $450/mt CFR this week, $25/mt lower than the deals done at $475/mt CFR last week. Taiwanese buyers’ demand for scrap is weak and the delivery of new cargoes are in the summer season in Taiwan, and Taiwanese mills are planning for maintenance works for this period because electricity costs are very expensive then. “We will produce less, so our demand for scrap is lower and will remain thus for a while,” the producer said.
Meanwhile, Japanese H1/2 50:50 scrap by bulk has been offered to Taiwan at $500/mt as compared to $540/mt CFR recorded last week. Despite the $40/mt decline in Japanese offers, there are no bids from Taiwanese buyers. “Even after the second price decrease announced this week, Tokyo Steel’s prices are too high right now. We believe they will need to revise their scrap procurement quotations further in the coming week, and so their export prices will also move down,” a mill commented. With South Korean and Taiwanese mills staying away from concluding deals from Japan, Japanese H2 scrap quotations will probably lose their strength.
Domestic HMS I/II 80:20 scrap prices in Taiwan have decreased by TWD 300/mt this week in two rounds to TWD 13,300/mt ($445/mt) ex-works, due to the depreciation of the local currency, with a decline of $13/mt on dollar-basis week on week. During the past week, official domestic rebar prices in Taiwan have also moved down, by TWD 300/mt to TWD 23,300/mt ($780/mt) ex-works, while dollar-based prices decreased by $10/mt week on week. Traditionally, domestic scrap prices in Taiwan are $20-30/mt cheaper than imports and this traditional margin is not seen right now. As a result, domestic scrap quotations in the country are expected to decline in the coming week. According to a source, “Since the downtrend expectation continues, no one is buying scrap or rebar right now,”
$1 = TWD 29.85