South Korea: Ferrous scrap inventory falls 3.8% w-o-w amid production cuts

• Scrap stocks remain below 800,000 t for 3 straight weeks
  
  
• Mills intent on reducing inventory, tightening scrap intake
  
  

SteelDaily: This week, the combined ferrous scrap inventory of eight major South Korean steel mills saw a slight 3.8% decrease to 724,000 tonnes (t), compared to the previous week's 784,000 t. This implies that stocks have remained below 800,000 t for three consecutive weeks. Domestic steelmakers' scrap iron inventory decreased from last week, significantly impacted by a reduction in production in the Yeongnam region.

Inventory levels in both the central and southern clusters showed mixed trends, with the decrease in the south greater than that in the central region.

Region-wise inventory

Central region: In the central region, scrap inventory decreased by 1.4% w-o-w to 415,000 t.

In terms of companies, Hyundai Steel's Incheon and Dangjin plants each experienced a 0.8% w-o-w drop in inventory. Hwanyang Steel, however, saw a significant 18% decrease compared to the previous week, while Dongkuk Steel's inventory levels remained unchanged w-o-w.

Southern region: In the southern region, inventory levels dropped by 6.3% compared to the previous week, to 340,000 t. Daehan Steel, Korea Special Steel, and Hyundai Steel's Pohang Plant maintained the same inventory levels as last week, while POSCO's inventory saw an 11% decrease w-o-w.

YK Steel's inventory decreased by 3% w-o-w, while Korea Iron and Steel's inventory increased by 17% compared to the previous week.

A market participant stated, "Due to insufficient demand, steelmakers are reducing production and controlling their scrap iron intake. To cut costs and offload stocks, mills have reduced unit prices, as carrying inventories is expensive."

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