Japan: H2 scrap export offers drop by $11/t w-o-w as buyers exercise caution

• Tokyo Steel plans to boost scrap collection
  
  
• Southeast Asian markets see mixed trends
  
  

This week, Japanese H2 scrap export offers saw a decline as market participants remained cautious due to price uncertainty, competitive offers from other exporters, and a weakening global market.

BigMint's weekly assessment pegged Japanese H2 scrap export offers at JPY 44,000/tonne (t) ($293/t) FOB Tokyo Bay, a drop of JPY 1,600/t ($11/t) from the previous week's level of JPY 45,600/t ($304/t) FOB.

Meanwhile, Japan's leading EAF steel manufacturer, Tokyo Steel, plans to open a new scrap iron collection centre in Funabashi, Chiba Prefecture, to enhance its scrap procurement network. The facility, expected to be operational by mid-2025, will collect 20,000 t of scrap per month and store up to 15,000 t. This move supports Tokyo Steel's long-term goal of producing 6 million tonnes (mnt) of crude steel by 2030 and 10 mnt by 2050.

Other market updates

Vietnam: Vietnam's imported scrap market saw a slight dip, with Japanese H2 scrap offers declining to $340-$345/t CFR, down $5-10/t from the previous week. While demand remained moderate, Vietnamese mills indicated they might shift to alternative sources such as Hong Kong if offers surpassed $350/t.

Deep-sea bulk scrap prices held steady, with US-origin HMS (80:20) offered at $375/t CFR Vietnam and bids at around $365/t. Australian-origin HMS (80:20) offers were at $370/t CFR. Despite muted transaction activity due to a persistent bid-offer gap, market participants hoped that rising finished steel prices would soon spur mills to increase scrap purchases.

Domestically, scrap offers in northern Vietnam for Type 1 or H2-equivalent material remained stable at VND 9,000-9,400/t, while southern prices stood at VND 8,500/t. Optimism grew as rising rebar and wire rod tags pointed to potential scrap price increases, with industry players also expecting billet offers to rise, signalling a positive outlook for Vietnam's steel market in the near term.

South Korea: South Korea's imported scrap market remained stable, with seaborne bids for HS at JPY 51,000/t ($341/t) and shredded at JPY 49,000/t ($327/t) CFR. Domestically, prices of H2-equivalent Light A grade scrap held steady at KRW 390,000-410,000/t, while Heavy A grade remained range-bound at KRW 415,000-430,000/t.

Some steelmakers reduced prices due to sluggish rebar sales and rising competition from imported scrap, while others maintained steady levels. With falling local rebar prices and increased stock levels, market sentiment was bearish amid growing competition from Chinese rebar imports.

Taiwan: Taiwan's scrap market saw an upward trend as Feng Hsin Steel, the country's largest rebar producer, raised both rebar list prices and local scrap buying prices by TWD 300/t ($9.3/t) for the week of 14-18 October. The hike was driven by higher global scrap prices, with US-sourced HMS (80:20) increasing by $10/t to $320/t CFR and Japan-origin H2 scrap rising by $15/t to $330/t CFR.

Strong rebar sales further supported price increases, but concerns lingered over fluctuating Chinese rebar prices, which could affect local demand.