Global Ferrous Scrap Market Overview - Week 49, 2018

Global scrap prices continued downtrend in major markets like Turkey, Japan, South Korea and South East Asia amid bearish sentiments. Conversely, Asian scrap prices, especially in India subcontinent, found some stability amid minor trades concluded ahead of a traditional slowdown in December month on seasonality concerns. Japan and South Korea observe no signs of bottoming out of prices yet and participants await for Kanto export tender scheduled next week. International scrap yards seem under no selling pressure which may shut down after the next week till early Jan'19. While the Asian market expects a slight correction in upcoming days on dull local fundamentals and a possibility of softening in global prices.

Turkey imported scrap prices drop in a deal concluded - After a short break of two weeks' without any significant deal, Turkish steel mill booked a European cargo as soon as it received corrected offer this week. A steel mill based in the Marmara booked a Benelux cargo, comprising 20,000 MT of HMS 1&2 (75:25), 12,500 MT of P&S and HMS 1, 5000 MT of Shredded and remaining 2,500 MT of New cutting scrap at an average price of USD 304/MT, CFR Turkey for December shipment. According to SteelMint's price assessment, this trade pulled HMS (80:20) from Europe at around USD 300-302/MT, CFR Turkey, and that of US origin at USD 308-310/MT, CFR down by USD 8-10/MT W-o-W.

Tokyo Steel cuts scrap purchase price twice this week - Japan's leading EAF steel mini-mill Tokyo Steel announced two more price cuts on 5th Dec and 7th Dec resulting in a total drop of JPY 1000-2000/MT (USD 9-18) this week. H2 at largest plant Tahara fetches JPY 30,500/MT and JPY 31,500/MT at Utsunomiya plant in the Kanto region. There are still no signs of bottoming out of prices and the market awaits Kanto Tetsugen tenders' result which is scheduled on 11th December in order to get a clear market sense.

China's scrap prices may come under pressure on narrowed profit margin - Although China's biggest scrap consumer, Shagang Steel kept scrap purchase price unchanged, local scrap prices increased by RMB 40-60/MT on rising finish steel prices this week. Shagang is paying RMB 2,420/MT inclusive of 16% VAT for HMS (6-10 mm thickness) in Zhangjiagang. However, on narrowed profit margins, China's scrap prices may come under pressure in the upcoming days.

South Korean Hyundai Steel cuts bid for Japanese scrap - Hyundai Steel slashed bids for Japanese scrap by JPY 500/MT (USD 4) as against last weeks' report which moved down to 16-month low levels. It placed bids for high-grade Shindachi at JPY 38,000/MT (USD 337), FoB and at JPY 30,000/MT (USD 266), FoB for Japanese H2. Presently, South Korean H2 import prices are cheaper than domestic lightweight A grade scrap by KRW 10,000/MT. Following which leading South Korean steel mills insist that there is still a possibility of a price cut in upcoming days.

Vietnamese scrap importers remain quiet, prices continue to fall - Imported scrap prices fall further this week on almost no significant demand in the market in Vietnam. HMS 50:50 from Hong Kong was being offered at USD 310/MT, CFR while Japanese H2 at USD 310-320/MT, CFR. USA origin Shredded offers heard at USD 340-345/MT and an assessment of HMS 80:20 stands at around USD 315/MT, CFR Vietnam.

Taiwanese scrap prices plunge further amid weak demand - Price assessment for USA origin HMS (80:20) stands at around USD 285-290/MT, CFR Taiwan in containers, down USD 5-7/MT as against last week. Weak downstream prices and availability of cheaper alternative kept scrap market silent in Taiwan.

Indian imported scrap prices firm, market turns tentative - India observed improved interest in imported scrap with trades being sold in the beginning of this week. However, the market remains mostly flat in terms of prices after last weeks' slump and slows down towards the closing of this week to observe clear global price direction in upcoming days. Suppliers hold prices slightly up as year-end market remains anxious.

SteelMint's assessment for containerized Shredded from Europe and UK stands flat at around USD 340-345/MT, CFR Nhava Sheva as against last weeks' report. Availability of Dubai HMS 1 remains tight amid material being sold out and offers are assessed in the range USD 330-335/MT, CFR. West African HMS 1&2 in 20-21 MT container stands at around USD 310-320/MT, CFR.

Pakistan's steel market continues bearish sentiments - Pakistan steel melters association appealed the Government officials to deliver a positive response in order to bring the steel industry out of current crisis situation. Short term trades concluded for imported scrap amid expectation of improvement in the local steel market. However, the market awaits economic stability and sentiments seem unlikely to improve any time soon. Offers for Containerized Shredded 211 from Europe and UK heard in the range USD 335-340/MT, CFR Qasim. Dubai HMS 1 is being offered in the range USD 335-340/MT with buying interest still at USD 330-335/MT, CFR on less supportive local fundamental.

Bangladesh observes minor trades, local steel prices stable - Minor trades for containerized Shredded 211 heard at USD 350-355/MT, CFR Chittagong. However, offers stand in the range USD 355-360/MT amid limited availability now. P&S scrap stands stable at around USD 365/MT, CFR. While HMS 1 from South America offered around at USD 335/MT for Jan'19 shipment. Local scrap and ship plate prices remained almost stable W-o-W. Sentiments remained moderate amid limited inquiries in the local market from end customers on approaching elections. Indian sponge iron export prices inched up this week to USD 360-365/MT, CFR Chittagong.