Japan: Tokyo Steel observe 3rd price cut in a week
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Japan's leading EAF mini-mill - Tokyo Steel has yet again decreased its domestic scrap purchase price by JPY 500/t and JPY 1000/t to Tahara works and Utsunomiya respectively, as per the new price circular released.
Notably, this is the third successive price cut observed since last week after continued price hike was witnessed from the last week of May'20 till mid-June. The new prices for all grades shall be effective from tomorrow (30th June'20). In the month of June'20 total 10 price revisions were reported, including 7 price hikes in 1st half of the month and 3 price cuts in the latter part of the month.
With this price adjustment, the company will now pay JPY 24,500 /t ($ 229) and JPY 24,000/t ($ 224) for H2 scrap delivered to its Tahara plant in Central Japan, and its Utsunomiya plant in the Kanto region respectively.
While the prices for H2 scrap delivered to the other plants remain unchanged at JPY 24,500/t for Okayama plant, JPY 25,000/t for Kyushu factory and JPY 23,500/t for Takamatsu steel center.
Due to the shortage in scrap availability and supply tightness being more severe in Kanto region as compared to other regions in Japan, the domestic scrap prices in Kanto region had shot up significantly more than others, consequently, Utsunomiya works (Kanto region) prices had surged more sharply earlier this month in comparison to the other four works of Tokyo steel, having reached almost 10 months high by mid-June.
Hence, with the Japanese export offers crashing sharply since last week, Utsunomiya prices are now seeing steeper price cuts to come on par with the normal price difference with the other four works.
Meanwhile, Japanese H2 export offers to South Korea continued to decrease by over JPY 3500-4000/t ($ 33-37) in last week as the latest deal was concluded at JPY 23,500/t to 24,000/t FoB Japan, levels last week, while Korean buyers are bidding at even lower level.
Tokyo Steel's bids for scrap purchase from 30th June'2020
| Name of Work of Tokyo Steel | |||||
| Scrap Grade | Tahara Plant | Okayama Plant | Kyushu Factory | Utsunomiya Factory | Takamatsu Steel Center |
| Special Class (H2) | 24,500 | 24,500 | 25,000 | 24,000 | 23,500 |
| First Grade | 24,000 | 24,000 | 24,500 | 24,000 | 23,000 |
| Second Grade | 22,500 | 22,500 | 23,000 | 22,500 | 21,500 |
| New Breaking Press A | 27,500 | 25,500 | 26,500 | 26,000 | 24,500 |
| Shredder A | 26,000 | 25,000 | 25,000 | 24,500 | 23,500 |
| Shredder C | 25,500 | 24,500 | 25,000 | 24,000 | 23,500 |
Price in JPY
Source: Tokyo Steel Reports
