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Japan: H2 scrap export offers remain largely stable w-o-w amidst limited demand from key import markets

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Melting Scrap

BigMint Bureau

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1 Mar 2024, 17:02 IST

Japan: H2 scrap export offers remain largely stable w-o-w amidst limited demand from key import markets

Japan's H2 scrap export offers remained steadfast w-o-w, propelled by limited demand from key importing nations and robust domestic prices. Consequently, BigMint's weekly assessment of Japanese H2 scrap stabilised at JPY 52,100/tonne (t) ($347/t) FOB Tokyo Bay, showing a marginal increase of JPY 100/t ($0.6/t) compared to the previous week's valuation of JPY 52,000/t ($345/t) FOB.

This week, Japan's steel scrap price index experienced a modest increase. The Japan Iron and Steel Association disclosed that the average price of H2 furnaces across three regions reached JPY 49,100/t ($326/t), marking a rise of JPY 100 ($0.6/t) from the previous week. This marked the second consecutive week of slight price increases. Breaking it down regionally, the price in Kanto surged to JPY 50,500/t ($335/t), reflecting a notable increase of JPY 300 ($2/t) from the previous week. In Chubu, prices stood at JPY 47,800/t ($317/t). Meanwhile in Kansai, prices reached JPY 49,000/t ($325/t).

Tokyo Steel, a leading Japanese mill, announced a JPY 2,000/t ($13/t) increase in domestic ferrous scrap purchase prices effective from 1 March, 2024. While H2 scrap prices remained unchanged at the Tahara and Utsunomiya plants, a surge was witnessed at the Takamatsu Steel Centre, with H2 scrap prices reaching around JPY 52,000/t ($347/t), marking the first price hike for March.

Other market updates

South Korea: South Korean steel mills displayed a lack of enthusiasm towards procuring scraps from the seaborne market, finding domestic scrap prices more favourable. Additionally, Hyundai Steel, a prominent South Korean steel mill, has opted to decrease scrap procurement prices by KRW 10,000/t ($) at its Incheon and Dangjin plants, effective from 8 March. This decision comes in response to declining demand attributed to electric furnace repairs and worsening market conditions.

Taiwan: Offers for Japanese H1/H2 50:50 scrap remained stable w-o-w at $380-385/t CFR Taiwan. However, Taiwanese mills did not submit any firm bids for Japanese scraps, as they were enticed by competitive offers of US origin HMS (80:20) at around $365-375/t.

Vietnam: Japan's H2 scrap export offer held firm at $388-395/t CFR Vietnam, while bids from buyers were evaluated at $385/t CFR. Consequently, no trades were reported in the market.

Outlook

Export offers from Japan are anticipated to remain range-bound, primarily due to limited demand from importing nations and influenced by global cues. Additionally, higher domestic realisations further likely to contribute to this trend.