China: Ferrous scrap imports drop 13% m-o-m in March amid weak finished demand

China's ferrous scrap imports in March 2023 stood at 17,428 tonnes (t) compared to 20,106 t in February, down 13 % m-o-m, as per SteelMint data.

Chinese mills majorly sourced ferrous scrap from Japan, South Korea, and Myanmar for the month under review.

Ferrous scrap imports declined in March as the appetite for steel in domestic and overseas markets weakened. Steel prices may continue to soften in the short term this being the traditional off-season for steel consumption.

However, China's ferrous scrap imports increased in the first quarter (January-March, 2023) or Q1 CY23 by 47% y-o-y to 63,072 t from 43,031 t in January-March, 2022.

Country-wise shipments

• Imports from Japan fall: Japan exported 11,324 t of scrap to China in March 2023, down 21% as against 14,329 t in the previous month. However, despite the drop, Japan still remained the top scrap exporter to China in March.
  
  
• Imports from South Korea increase: Chinese mills imported a total of 3,143 t of ferrous scrap from South Korea in March 2023, an increase of 10% compared to 2,845 t in February 2023.
  
  
• Imports from Myanmar stable m-o-m: Imports from Myanmar remained mostly stable at 1,233 t in March 2023, showing a dip of 1% against 1,243 t in the previous month.
  
  

Imported Japanese H2 scrap prices

As per SteelMint's assessment, Japanese H2 scrap prices into China stood at $407/t CIF in March as against $387/t during February, a rise of 20/t m-o-m.

Outlook: Judging by the current status of China's domestic finished steel market, the short term may see a further fall in scrap import volumes. However, minimal purchases from secondary steel mills may continue, as per SteelMint analysis.