Tokyo Steel reduces its local scrap prices for the second time this week

Having reduced its price for the first time since August 18 on September 21, the major EAF-based steel producer in Japan, Tokyo Steel, has announced a second cut in its local scrap procurement prices today, September 22. The downward revision was mostly JPY 500/mt, with only a JPY 1,000/mt cut observed for shindachi quotations at the Tahara plant. Once again, the revision has had little impact on the dollar-based price range of Tokyo Steel’s prices. It is noteworthy that South Korea’s Hyundai Steel has announced its bids for Japanese scrap, with a JPY 1,300/mt decline as compared to August 31, and this move may exert downward pressure on the local Japanese scrap market in the coming days. A Japanese source commented, “We need to check the quantity Hyundai Steel bought today, but I think the bid has impacted the Japanese market and then Tokyo steel reduced its list price.”

Tokyo Steel’s general range for H2 grade scrap is now at JPY 47,500-50,500/mt ($332-353/mt) depending on the mill, decreasing by $2/mt on the lower end and by $1/mt on the upper end due to the fluctuation of Japanese yen-US dollar exchange rate. Still, the Okayama, Kyushu and Utsunomiya plants have the same procuring prices and represent the higher end of prices. The lowest price is still at the Takamatsu plant.

Tokyo Steel’s general range for shindachi scrap is currently at JPY 49,500-52,500/mt ($346-367/mt). The dollar-based prices have decreased by $2/mt on the lower end and by $1/mt on the upper end. All prices in question are delivered and effective as of September 23. Exchange rate fluctuations are taken into consideration when calculating the dollar-based price changes.

$1 = JPY 142.65