Tokyo Steel increases domestic scrap prices by another $17/mt

The major EAF-based steel producer in Japan, Tokyo Steel, has announced an increase for local scrap for the second time. Having been cutting its prices gradually since May 6, the producer changed its price strategy on August 18 and started to increase its local scrap prices. Supported by the revived foreign demand for the Japanese scrap in other Asian countries, prices are moving up also domestically. Not just in Japan, but local scrap prices are increased in South Korea and Taiwan too as producers are trying to secure the tonnages they need. A Japanese source reported that “Today some mills raised their purchasing price so market sentiment is optimistic. We also feel it is a temporary uptrend”.

The raise announced by Tokyo Steel today was JPY 1,000-3,000/mt effective as of August 25, except in Tokyo Steel’s Tahara plant. After the $17/mt increase, prices for H2 scrap have reached JPY 42,000-46,000/mt ($305-335/mt) depending on the mill. Exchange rate fluctuations are taken into consideration when calculating the dollar-based price changes.

The Tokyo Steel’s shindachi scrap prices have also moved up by JPY 3,000/mt or $17/mt, again except for Tahara plant, to the range of JPY 44,000-48,000/mt ($320-349/mt).

Meanwhile, Japanese export scrap prices continue to move up. As of August 24, Tokyo Bay FAS prices for H2 scrap are in the range of JPY 44,500-45,500/mt ($324-331/mt), corresponds to JPY 45,500-46,500/mt ($331-339/mt) FOB. This level on average equals to South Korean Hyundai Steel’s bids offered to Japan today at JPY 46,000/mt ($335/mt) FOB. Earlier this month [Aug. 8], Tokyo Bay FAS based prices for H2 grade were corresponding to JPY 39,500/mt ($296/mt – exchange rate at 133.68) FOB.

Meanwhile, HS scrap and shindachi scrap prices are at JPY 46,000-48,000/mt ($335-349/mt) and JPY 46,000-47,000/mt ($335-342/mt), respectively both Tokyo Bay FAS terms.

$1 = JPY 137.35