South Korea: Hyundai Steel Books Bulk Japanese Shindachi Scrap at Lowered Prices

South Korean leading EAF steelmaker Hyundai Steel has lowered the purchase price of Japanese high grade scrap further. As per reports, the steelmaker recently presented purchase price for Shindachi scrap at JPY 40,500/MT (USD 357), FoB which is lower by JPY 1500/MT (USD 13) as against last report at JPY 42,000/MT, FoB. It has contracted for about 24,000 MT Shindachi scrap from Japan through individual negotiation at these levels.

Hyundai Steel's price difference between Japanese H2 and Shindachi grade stands at JPY 8,000/MT. Thus, Hyundai's H2 purchase price expectation is at around JPY 32,500/MT, FoB Japan. However, there is no news of offers or bookings at these prices in the market yet. Last week, South Korean steelmakers contracted H2 at JPY 34,000/MT, FoB Japan.

Japan's domestic scrap prices continued to plummet sharply in last two weeks' time and many of the participants are now expecting that prices are likely come down more. Japanese scrap exporters turned active over rising supply and an anticipation of further price drop in the market.

Japan's Tokyo Steel has cut its scrap buying prices thrice by a total of JPY 2,500-3,000/MT since last Friday. Its H2 buying price at its Utsunomiya works in Kanto region hit last 6 month low and stands at JPY 34,000/MT. While its central region Tahara plant fetches H2 at JPY 33,000/MT.

Hyundai Steel less likely to resume bids for Japanese scrap shortly - Since past few months, Hyundai has booked significant volumes of scrap from USA in bulk cargoes amid high Japanese prices while it stood away from bidding for Japanese scrap. Its requirement for H2 hasn't recovered yet amid high inventories thus, steelmaker seems less likely to place bids till Jan'18 and may continue to buy high grade scrap through individual negotiations.

~ Inputs from SteelDaily