Japan: Scrap export market regains momentum on Chinese resumption

Japanese scrap suppliers were not seen actively participating in fresh scrap export offers this week. Most of the Japanese suppliers are more involved in trading in the domestic market following a spurt in domestic demand. Imported scrap offers to other prominent buyer countries have slightly increased over a week.

Bulk Japanese H2 scrap offers for Vietnam and Bangladesh currently stand at $475/t and $500/t CFR basis respectively sources have reported to SteelMint.

Offers for Japanese H2 are being citied at JPY 44,000-45,000/t FoB basis. It has increased by around JPY 11,500 in the last one month. SteelMint’s price assessment for Japanese H2 scrap export stands at JPY 44,500/t FoB, mostly stable on a weekly basis.

Chinese resumption of scrap imports turns Japanese scrap traders active- Japanese scrap export market has remained active in recent bookings made by Chinese traders. A Chinese scrap trader has concluded a deal of 3,000 t of Japanese HS grade scrap. The deal was heard to have been concluded at $485/t CFR China basis. However, despite the resumption, China’s scrap imports would remain slow initially, SteelMint understands. However, fresh offers are heard close to $500-505/t CFR levels.

South Korean buyers remain cautious on imported scrap bookings– South Korean buyers remain cautious in booking fresh slots for Jan-Feb’21 shipment. Hyundai Steel didn’t place bids for Japanese scrap in the last two weeks. Dongkuk Steel has booked 10,000 t of Japanese H2 recently at FoB 43,000/t FoB basis, as per SteelDaily.

Japanese domestic scrap prices remain unchanged – Japan’s leading steel mill – Tokyo Steel has not made any price revision in scrap purchase this week. Last price was at JPY 43,000/t for H2-scrap delivered at both Tahara and Utsunomiya works.

Outlook– Japan’s monthly Kanto Tetsugen scrap export tender is scheduled on 13th Jan’21, sources have reported to SteelMint. Nearly 20,000 t of Japanese H2 scrap is auctioned via Kanto export tender every month and serves as a benchmark for the Japanese scrap export market.