Import scrap procurement prices in Taiwan have continued to move down over the past week. Finished steel demand is still on the low side, with some market players describing the situation as “bad”. With the lack of steel demand and decreasing steel prices, Taiwanese mills are in no rush to conclude scrap bookings. Hence, particularly ex-US and ex-Australia scrap offers to Taiwan are now rare. SteelOrbis understands that those sellers have also lost the price advantage to Japanese suppliers who have been cutting their offers to Taiwan for weeks now. “No one is so willing to buy scrap but, now with Japanese scrap quotations declining, we can easily say they are more attractive for a willing party,” a source at a Taiwanese mill commented.
As compared to the levels recorded in SteelOrbis’ report published on July 22, the price of ex-US HMS I/II 80:20 scrap in containers to Taiwan has declined from the range of $345/mt CFR to $330-335/mt CFR. Market sources report that there are only a few offers from the US to Taiwan. According to a source, there are several reasons for this: first, the very low price levels acceptable for Taiwanese mills, secondly, expensive freight costs, and, thirdly, the lack of demand. A market player stated, “If they continue to offer scrap to Taiwan, they will exert downward pressure on prices by themselves. Hence, they are staying quiet for now.”
Meanwhile, there are offers from South America and Australia for the same grade in containers, even at lower levels of around $325/mt CFR. There are also few ex-Australia offers, SteelOrbis has heard. Actually, following the offers shared early this week from Australia, no more offers have been heard from that region as sellers lost interest.
Offers for Japanese H1/2 50:50 scrap by bulk to Taiwan have indicated another $20/mt decline from $355/mt to $335/mt, both CFR. According to a buyer, with negotiations this level can be reduced to $330/mt CFR since buyers will bid for $325/mt CFR. “The gap between Japanese and US scrap has closed. Now Japanese scrap has the advantage. No one will buy scrap of other origins. But again, there is not much demand for import scrap,” a source commented.
Under the sluggish demand conditions, the decreasing trend observed in the Taiwanese domestic market has continued over the past week. Domestic HMS I/II 80:20 scrap prices in Taiwan have declined by TWD 500/mt or $17/mt to TWD 9,600/mt ($320/mt) ex-works. The official domestic rebar prices in Taiwan have decreased by TWD 800/mt ($27/mt) week on week to TWD 19,200/mt ($641/mt) ex-works.
$1 = TWD 29.96