South Korea: Ferrous scrap inventory at major mills remains stable w-o-w

This week, the combined ferrous scrap inventory of eight major South Korean steel manufacturers was approximately at 788,000 tonnes (t) with a slight decrease of 2,000 t compared to the previous week's 790,000 t. The direction of inventory changes varied by region, the differences in the rates of increase or decrease were not significant.

Meanwhile, inventory levels rose slightly in the southern region but dropped in the central region.

Region-wise inventory

Central region: Specifically, steelmaker's inventory in the central region was 406,000 t with a slight decrease of 0.7% compared to the last week. The trend of increase or decrease varied for each company, depending on whether or not they implemented a price cut.

Southern region : In southern region, the inventory levels rose by 6% compared to the previous week. The combined inventory of Daehan steel and YK steel also increased by 3.3%. However, the inventory levels in POSCO saw a decrease of 1.5%.

Hyundai steel's Incheon and Dangjin factories remained stable as last week while Dongkuk increased inventory level by 2.5%. Additionally, Welcome Steel's inventory decreased by 13.8% compared to the last week.

The demand for ferrous scrap is not expected to increase due to sluggish product sales and major maintenance during off-season.

Meanwhile, steel mill inventories have remained below 800,000 t since mid-May, but there is still no sense of a shortage. There is no possibility of increasing factory operations while covering up the sluggish product sales during off-season.

Industry officials reported that demand for iron scrap is unlikely to rise due to sluggish product sales and scheduled maintenance during the offseason. An industry representative stated, "Increasing the factory operation rate is impossible while anticipating the possibility of sluggish sales during the off-season." He further added, "The factory is not shut down, but we are aware that it may face operational challenges."

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