Tokyo Steel announces another scrap price cut for Utsunomiya plant

The major EAF-based steel producer in Japan, Tokyo Steel, has announced a JPY 500/mt reduction in its local scrap procurement prices at its Utsunomiya plant, while it has kept prices for its other plants stable. Domestic scrap prices in Japan are still considered higher as compared to the desired levels of foreign buyers such as the South Korean and Taiwanese mills.

Following this new announcement, Tokyo Steel’s prices for H2 scrap have remained stable as compared to the prices shared by SteelOrbis on Thursday, June 9, at JPY 55,000-56,000/mt ($409-417/mt) depending on the mill. But due to the depreciation of the Japanese yen against the US dollar, in dollars the prices have declined by $2/mt on both ends of the range.

The Shindachi scrap price range of Tokyo Steel has also moved sideways, despite the JPY 500/mt or $2/mt cut at the Utsunomiya plant, at JPY 57,500-61,000/mt ($428-454/mt). All prices are delivered and effective from June 16.

According to the Financial Times, “Currency analysts had warned last week that the yen was likely to remain highly volatile against the dollar ahead of the BoJ’s monetary policy meeting on Thursday and Friday”. After hitting a 24-year low of JPY 135.17 against the dollar on Monday, the Japanese yen has regained some strength. “The Nikkei 225 Japanese stock index, which typically rises when the yen falls because a weaker currency is seen as positive for exporters, fell three percent on concern over the broader impact on the economy,” the Financial Times stated. This impact has caused some analysts to consider that the traditional support of the depreciating yen has not been seen this time and actually instead of supporting it is damaging the economy.

$1 = JPY 134.42