South Korea: Ferrous scrap inventory at major mills rise after 6 weeks

This week, the ferrous scrap inventory rose for the first time in six weeks since early May 2024. This change happened due to a production cut trend spread across the industry.

The combined ferrous scrap inventory of eight major South Korean manufacturers was approximately 790,000 tonnes(t) leads to an increase of about 24,000 t which is a 3.1% rise compared to the previous week.

Meanwhile, the inventory levels rose slightly in central and southern regions. However, in the central region price reduction was relatively slow and was more unpaid.

Region-wise inventory

Central region: The steel maker's scrap inventory levels increased by 4.8% from last week to 409,000 t. Company-wise, Hyundai Steel's Ichleon plant kept its inventories at the same level as compared to the previous week. While Dangjin plant inventories increased by 8.3%, Dongkuk steel increased by 6.6% and Hwan steel increased by 12.5%.

Southern region: In the southern region the ferrous scrap inventory stood at 381,000 t, an increase of 5,000 t increased by 1.3% from the previous week. In contrast, there is a decrease of 1.6% in Daehan Steel and YK Steel's combined scrap inventory as compared to the last week.

Hyundai Steel's Pohang plant's inventory levels remain stable as last week, Korea Steel's inventory increased by 6.4% and POSCO set to finish renovating its fourth blast furnace by the end of June, saw a 2.1% increase. Additionally, the combined steel scrap of Korea special steel and Russian steel scrap increased by 7.5% as compared to last week.

Meanwhile, June scrap inventory by year stood at 774,000 t which is over 100,000 t less than the average of 899,000 t recorded from 2020 to 2023.

However, due to a significant drop in steel production caused by weak demand, inventory shortages are now less severe than in the past.

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