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Japan: Kanto tender bids up $13/t m-o-m; H2 export offers dip on weak demand

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Melting Scrap
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10 Jan 2025, 15:57 IST
Japan: Kanto tender bids up $13/t m-o-m; H2 export offers dip on weak demand

  • Suppliers withhold offers for price clarity

  • Kanto tender sees 15,000 t booked at $283/t

Japanese H2 scrap export offers softened during the week amid sluggish demand and competitive pricing, with suppliers withholding offers to await price clarity from the Kanto tender.

The Kanto tender, concluded today, provided a lift, as bids increased by $13/t m-o-m (JPY 2,071/t). A 15,000-t H2 lot was sold to a Bangladeshi mill at JPY 44,810/t ($283/t) FAS, with CFR Bangladesh prices assessed at $350-355/t, including freight costs of $65-70/t. Despite subdued global interest in Japanese H2, Bangladeshi buyers offered strong bids, fuelled by domestic scrap shortages, improved letter of credit (LC) availability, and growing steel demand.

BigMint's weekly assessment of Japanese H2 stood at JPY 41,700/t ($263/t) FOB Tokyo Bay, down by JPY 400/t ($3/t) compared to JPY 42,100/t ($266/t) FOB in the previous week.

Other market updates

Bangladesh: Bangladeshi buyers showed renewed interest, supported by rising steel demand and eased LC openings. Mills in Dhaka were more active compared to Chattogram due to domestic scrap shortages.

Bulk HMS offers from Singapore were at around $378-380/t CFR Chattogram, while PNS was priced at $393-395/t CFR. Japanese H2 scrap was offered at approximately $345-348/t CFR Chattogram, amid limited demand. US offers ranged at $365-370/t, though buyers bid below $360/t.

Vietnam: Vietnam's imported scrap market remained subdued during the week, marked by muted demand ahead of the Lunar New Year. Japanese H2 scrap offers ranged within $310-320/t CFR Vietnam, while tradable values were closer to $305-309/t. A recent deal for H2 was reportedly concluded at $305/t CFR. Divergence persisted between buyer and seller expectations, with buyers targeting $305/t and sellers aiming for $310-315/t.

Domestic scrap prices in southern Vietnam remained competitive compared to imports. Freights stayed steady, with February and early-March shipments available. Market sentiment was slightly bearish due to slow downstream demand, with participants awaiting clarity following the holidays.

Taiwan: Feng Hsin Steel, Taiwan's largest rebar producer, decided to maintain its rebar list prices and local scrap buying prices for transactions from 6-10 January. This marks the third consecutive week of unchanged prices amid uncertainty in global scrap markets. The company offered its 13mm dia rebar at TWD 18,000/t ($549/t) exw, while the local procurement price of HMS (80:20) scrap was at TWD 8,600/t.

Mini-mills in Taiwan held steady on prices, awaiting clearer market trends. Additionally, the weakening of square billet tags and reduced rebar sales indicated cautious market sentiment. The Chinese mainland steel market also saw declining spot rebar prices, contributing to a wait-and-watch approach in Taiwan.

South Korea: South Korea's imported scrap market saw limited activity during the week, amid cautious buying and competitive offers. Japanese H2 scrap offers hovered at $325-330/t CFR South Korea, with tradable levels reported around $320-325/t.

Buyers adopted a wait-and-watch approach, awaiting price clarity from the Kanto tender and observing global market trends. Domestic scrap prices remained competitive, discouraging significant imports. Freights were stable, with shipments available for February. Market sentiment leaned bearish due to slow steel demand and ample inventories, with participants expecting clearer direction after the Kanto tender results.

Major South Korean steelmakers, including POSCO, Taewoong, Korea Iron and Steel, and SeAH Changwon Special Steel, raised steel scrap purchase prices by KRW 10,000/t ($7/t) for all grades. The hike took effect from 10 January 2025 at POSCO's Gwangyang and Pohang plants, Taewoong, and SeAH Changwon, while Korea Iron and Steel will implement the increase during a special purchase period over 11-18 January 2025.

Outlook

Japan's H2 scrap market is expected to receive some support from the recent Kanto tender, which saw higher bids. However, subdued buying interest in importing countries may continue to weigh on the market, leading to volatility in prices.

10 Jan 2025, 15:57 IST

 

 

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