South Korea: Ferrous scrap imports up 10% m-o-m in Jul'21

South Korea recorded ferrous scrap import volumes of 0.43 million tons (mn t) in Jul'21, up by 10% m-o-m against 0.39 mn t in Jun'21, as per data maintained with SteelMint.

Japan continued to be the largest supplier to South Korea, at 0.27 mn t, followed by the US and Russia at 0.08 mn t and 0.05 mn t respectively.

Market overview

• South Korea's imports from US bounced back: Scrap imports volumes from the US bounced back to 0.08 mn t in Jul'21 as against 0.04 mn t in Jun'21. South Korean local mills remained active in booking bulk cargoes from the US on preference over Japanese scrap.
  
  
• Imports from Japan fall: Scrap imports from Japan fell by 10% to 0.27 mn t in Jul'21 from 0.30 mn t in Jun'21. Export volumes from Japan lowered on account of fewer trade deals heard due to discrepancy in bids and offers on robust domestic demand. Japanese domestic scrap prices rose to JPY 51,000/tonne (t) in June from JPY 47,000/t in May for Utsunomiya plant, as per SteelMint. South Korea-based mills preferred to book Russia-based scrap cargo over Japanese scrap, as per reports tracked by SteelMint.
  
  
• Imports from Russia up: Scrap imports from Russia rose by 25% to 0.05 mn t in Jul'21 from 0.04 mn t in Jun'21. Russian scrap A3 prices were lower and in accordance with the demand from South Korean mills due to which export volumes from Russia increased.
  
  
• Japanese scrap prices up in Jun'21: SteelMint's monthly average price assessment for Japanese H2 scrap exports rose by JPY 375/t ($3/t) m-o-m to JPY 48,500/t ($444/t) FoB in Jun'21.
  
  

South Korea's total scrap imports during Jan-Jul'21 were recorded at 2.39 mn t, lower by 7% y-o-y.

Outlook
South Korean mills are booking scrap of Russian origin due to the high prices for scrap being offered by Japanese mills which are resulting in disparities in bids and offers. However, most buyers prefer to wait and watch as Japanese sellers will be away from the market due to their Obon holidays.

On the other hand, the South Korean steel market is doing well and is expected to see better steel production for the second half of this year.