South Korea's ferrous scrap arrival volumes drop w-o-w on sluggish market conditions

Steel scrap arrivals into South Korea dropped to 52,158 tonnes (t) (drop by over 40,000 t) in the current week from 92,834 t seen on 8 August 2023. A persistent drop is seen in new arrivals of steel scrap for the last two months owing to the sluggishness in the market and continuous price drop which lasted till July besides a higher inventory ratio. On a weekly average, new scrap arrivals have not crossed the 100,000 t mark since the end of June.

Company-wise arrival

Hyundai Steel: Hyundai Steel, a prominent player in the steel industry, has brought 22,358 t of new iron scrap from Incheon, Pohang, and Dangjin ports - down by 7,000 t compared to last week. A major chunk of scrap came from Incheon at 15,358 t, followed by 2,000 t and 5,000 t from Dangjin and Pohang, respectively. Notably, all the material that is being shipped from ports to Hyundai Steel has been imported from Japan.

Dongkuk Steel: Dongkuk Steel sourced 17,300 t (down 7,500 t w-o-w) of scrap majorly from the Incheon port. Out of which, 4,300 t of scrap was sourced domestically while 6,000 t was imported from Russia, and the rest from Japan. The steel major also bought 4,953 t of pig iron from Pohang port.

POSCO: Steel giant, POSCO, has lowered its new arrivals from various ports in the current week. The company sourced 2,000 t each from Gwangyang and Pohang, respectively. The steel major has also booked 31,300 t of HBI during the week under purview.

Others: Daehan Steel reported new iron scrap arrivals of 5,500 t from Busan port while Korea Steel at 3,000 t from Masan port. YK Steel and SeAh Besteel did not report new shipments this week.

Since the end of June, steelmakers have consistently concluded import contracts primarily from Japan, suggesting a steady inflow of supply. The accumulated volumes of imported materials might introduce market variability post-September. This accumulation could serve as a foundation to counteract potential domestic price surges as the market demand for scrap improves upon entering September.

"Despite the current economic conditions not as good as previous years, demand for scrap is likely to rise in September," said an official from a domestic scrap supplier.

Note: This article has been published in accordance with an article exchange agreement between SteelDaily and SteelMint.