South Korea: Steelmakers' ferrous scrap inventory declines further by 9% w-o-w

South Korean steelmakers' scrap inventory continues to decline for yet another week. Major steelmakers had 707,000 tonnes (t) of scrap stock in the fourth week of December, down by 9% w-o-w from 774,000 t recorded a week ago, as per a SteelDaily report. Most steelmakers showed a double-digit decline in their inventory.

Region wise inventory-

• Central region: Inventory at Hwan Steel and Dongkuk Steel declined significantly, and the total inventory of steelmakers in the central region decreased by 11% to 436,000 t. The steelmaker with the largest drop in inventory was Hwan Steel, decreasing by 40% compared to the previous week.
  
  

Dongkuk Steel also lost 21% of its inventory in a week.

• Busan-Gyeongnam region: The decline in inventory of steelmakers in the Busan-Gyeongnam region is also steep. Daehan Steel, YK Steel, and Korea Iron and Steel, all showed a reduction of more than 30% in inventory in one week.
  
  
• Southern region: The total inventory of steelmakers in the southern region decreased by 3.7%. Hyundai Steel's inventory decreased by 2.3% in Incheon, Pohang, and Dangjin, and POSCO's inventory decreased by 3.6%.
  
  

Mills raise domestic scrap purchase price-

As inventory sharply decreased, steelmakers raised domestic scrap purchase prices by KRW 40,000/t in just one week, including the recent hike in bid made by SeAH Steel, effecive 28 December.

However, suppliers are expecting further price hikes due to low inventory with steelmakers and reduced stock. Due to such expectations, suppliers' scrap collection prices are even reversing the steelmakers' purchasing prices.

Meanwhile, demand from POSCO has decreased significantly due to an increase in self scrap consumption.

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