Japan: Scrap exports rise over 15%, m-o-m, on higher shipments to South Korea

Japan, a prominent ferrous scrap exporter globally, reported an 18% rise in exports of scrap in March, 2022. The country recorded 590,000 t of scrap exports in March as against 500,000 t in February, as per customs data maintained with SteelMint.

On a y-o-y basis, exports by Japan dropped 16% compared to 700,900 t in March, 2021.

Market scenario

• Exports to South Korea rise: Japan exported 330,000 t of ferrous scrap to South Korea in March, 2022 as against 280,000 t in February, marking a hike of almost 18% m-o-m. Major mills in Korea had postponed its purchase bids from the domestic market in expectation of a rise in scrap prices due to tight availability. Thus, they opted for imported scrap.
  
  
• Exports to Vietnam plunge during holidays: Vietnam's ferrous scrap import volumes from Japan stood at 100,000 t in March as against 120,000 t in February. Trades cooled off and, overall, the market has slowed down amid limited enquiries due to the Tet holidays, SteelMint understands.
  
  

However, prominent Japanese buyers such as Bangladesh preferred other prospective sources like the USA and the European Union, owing to price disparities in the market.

Japanese H2 scrap prices rise: The monthly average price in February went up by JPY 5,750/t to JPY 56,000/t FOB. The prices have surged owing to a decline in shredded scrap generation due to lower automobile production amidst chip shortage.

Outlook
The Japanese Yen depriciated in February by $2-3 and stands at $115 against the USD as compared to $113 in December, 2021. The ongoing depreciation in the currency has impacted bids for Japanese scrap.