South Korea: Ferrous scrap inventory declines after 3 weeks of continuous increase

SteelDaily: This week, the combined ferrous scrap inventory of eight major South Korean steel mills touched 690,000 tonnes (t), marking a fall of 2.4% from 707,000 t seen a week back. Notably, domestic steelmakers' scrap inventory has declined for the first time in three weeks, primarily due to the upcoming Chuseok holiday shutdown.

Region-wise inventory

Central region: In the central region, scrap inventory fell by 5% w-o-w to 325,000 t.

In terms of companies, Hyundai Steel's Incheon plant experienced an 8% reduction in inventory levels compared to the previous week.

Meanwhile, the Dangjin plant experienced a substantial 22% w-o-w drop in inventory levels, while Hwanyoung Steel saw a significant 16% w-o-w reduction, resulting in a notable overall decrease in inventory.

Dongkuk Steel, which was under major maintenance since late August, helped offset the overall inventory drop by increasing its levels by 15.7% compared to last week.

Southern region: In the southern region, inventory levels were assessed at 365,000 t, stable compared to last week. Hyundai Steel's Pohang plant witnessed an increase of 13.3% in inventory levels, while POSCO's scrap inventory dropped by 7.8% w-o-w.

The combined inventories of Daehan Steel and YK Steel rose by 1.5% w-o-w. On the other hand, Korea Iron and Steel's inventory remained stable from the previous week.

Currently, the total steel inventory stands below 700,000 t, which might appear low given the anticipated increase in production before October's busy season. However, with rebar steel demand projected to remain under 8 million tonnes (mnt), maintaining high inventory levels could pose risks. As the peak season approaches, Hyundai Steel's Dangjin plant is undergoing long-term maintenance, while Dongkuk Steel is gearing up for full-scale production.

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