Hyundai Steel Bought 10,000 MT Japanese Scrap at Previous Price Level- Traders Report

South Korea's leading electric arc furnace steel maker - Hyundai Steel has maintained its import prices for Japanese H2 ferrous scrap stable since last few weeks. The bid prices for Japanese H2 scrap were kept at Yen 30,500-31,000/MT (USD 268-272) FOB Japan.

As per recent traders report, Hyundai steel managed to fetch 10,000 MT Japanese scrap at these price levels. However, quantity fetched were quite lower compared to requirement of scrap possessed by the company.

A trade source shared that-"Hyundai Steel has managed to get 10,000 MT H2 scrap from Japan recently at the same bid levels at USD 268-272/MT FOB which was similar to what they had paid for last bookings. Yet quantity fetched is quite lower than the desired."

The bids remained firm for H2 at Yen 30,500-31,000/MT. While HS accessed at Yen 33,000-33,500/MT and Sindachi at Yen 34,500-35,000/MT, FOB Japan respectively.

Presently, trade activities from Japan to South Korea have been slowing down following the increased freight charges. Most of South Korean steel makers remain silent in importing scrap from Japan over the increased overall prices. Japanese participants consider bids offered by South Korean mills as a trend setter in the market.

Hyundai Steel would have to lift the bid prices slightly in order to buy further scrap materials in the near term from Japan. Reason being, higher expectation of Japanese scrap suppliers, which is not less than Yen 32,000-32,500/MT (USD 280-285), FOB Japan as domestic demand is good.

Japan's domestic scrap demand remains strong as this is a peak construction season in Japan. Japanese traders justify the strong demand for scrap in the domestic market by incremental billet exports from Japan. Following this, the Japanese companies have increased their domestic scrap purchases.

Japan exported 6.01 MnT ferrous scrap during the period of first nine months of CY17 (Jan-Sept'17), down 9% Y-o-Y. Out of the total scrap exported from Japan during Jan-Sept'17, South Korea accounted for largest share of 48% with import of 2.91 MnT.

Price list for ferrous scrap in Japan-

1. H2 for Tahara Plant, Tokyo Steel Japan at Yen 32,000/MT, at works gate
2. H2 for Okayama works, Tokyo Steel Japan at Yen 31,000/MT, at works gate
3. Shredder A for Tahara Plant, Tokyo Steel Japan at Yen 32,500/MT, at works gate
4. Shredder A for Okayama Plant, Tokyo Steel Japan at Yen 31,500/MT, at works gate
5. Offers assessed for H2 at Yen 30,750/MT, FOB Japan
6. Offers assessed for New cutting (press) at Yen 33,000/MT, FOB Japan