Japan: Ferrous scrap export shipments fall over 15% in May

Japan, a prominent ferrous scrap exporter globally, reported a 17% fall in scrap exports at 0.54 mnt (million tonnes) in May, 2022, as against 0.65 mnt in April, as per customs data maintained with SteelMint. Higher prices kept demand for Japanese scrap on the lower side for key buyers.

However, on a y-o-y (year-on-year) basis, exports dropped 21% from 0.68 mnt in May, 2021.

Market scenario-

• Exports to South Korea fall: Japan exported 0.24 mnt of ferrous scrap to South Korea in May as against 0.36 mnt in April, marking a significant fall of 33% m-o-m. Despite the decrease in exports, the country retained its position as the largest buyer of Japanese scrap.
  
  
• Exports to Vietnam drop: Ferrous scrap exports to Vietnam fell 16% to 0.16 mnt in May vis-a-vis 0.19 mnt in the previous month. Shipments to Vietnam dropped due to Covid-19 lockdowns in the country. Also, billets supplies from Russia increased at lower prices, which reduced the demand of scrap.
  
  

Notably, Bangladesh imported 0.04 mnt of ferrous scrap from Japan after a month's gap. It was noticed that leading Bangladeshi steel mills increased their capacity utilisation lately and scaled up imports of bulk cargoes, as the quality of scrap being exported in bulk is reliable.

Additionally, the container problem shortage is extending the time of containers and delivery is taking place after 2-3 months.

Japanese H2 scrap prices rise: The monthly average price in April went up by JPY 3,700/t to JPY 65,700/t FOB from JPY 62,000/t in March.

Outlook
It is expected that the market would remain subdued due to lower buying interest from both domestic and international buyers.