Japan’s Kansai Iron and Steel Federation, an association of scrap dealers around the Osaka region was concluded yesterday, (4th Sept’19) in which the winning bid was awarded a total 5,000 MT of Japanese H2 at an average of JPY 25,110/MT (USD 236), FAS, while Econecall was reported to be the successful bidder. The shipments for the cargo are slated from 4th Sep’19 onwards till 30th Sep’19. Notably, the current bid is JPY 3010/MT (USD 28) lower than the last winning bid in July’19, witnessing a significant decline.
With the consistent fall in the Japanese domestic scrap prices especially in the last couple of weeks, a sharp drop in this month’s winning bid was expected, while the resultant price is also in line with the current bids for scrap export from major overseas buyers, as even Hyundai steel has reduced its purchase bids for scrap export by JPY 1000/MT.
Currently, there is an oversupply situation of ferrous scrap in the Japanese domestic market, hence the Kansai federation is looking to increase its exports in order to balance the local supply and demand. Reportedly, the federation is aiming to export a combined 10,000 MT of ferrous scrap in the month of September’19.
However, in addition to the downtrend in the Japanese scrap prices, the global market has also turned down considerably in recent weeks, and with the ongoing factors US-China Trade conflict and instability in Japanese currency exchange rates, the Japanese exports may turn sluggish on low demand, in turn pulling the domestic prices down further.
Also the market awaits response of Kanto Tetsugen tender which is scheduled on 11th of Sept’19 to understand Japanese scrap price scenario.
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