South Korea recorded ferrous scrap import volumes of 0.39 million tonnes (mn t) in Jun’21, up by 8% m-o-m against 0.36 mn t in May’21, as per data maintained with SteelMint.
Japan continued to be the largest supplier to South Korea, which is one of the largest ferrous scrap importers, at 0.30 mn t, followed by the US and Russia.
Yearly scrap imports were recorded at 0.39 mn t in Jun’21 as against 0.33 in Jun’20, up by nearly 18% y-o-y respectively.
Market overview
Imports from Japan rise: Japan was the largest scrap supplier at 0.30 mn t in Jun’21 with 71% share of the total volumes exported to South Korea. Demand for imported scrap from the Korean mills increased following growing domestic steel demand. This is likely to increase further after the Golden Week holidays. Hyundai Steel expects to restart operations at two of its hot rolling mills and the rebar plant heating furnace at its Diangjin steelworks after Jun’21. Operations at Hyundai Steel’s Diangjin works remained suspended after an accident, as SteelMint had reported earlier.
Imports from Russia fall: Scrap imports from Russia fell by 20% to 0.04 mn t in Jun’21 from 0.05 mn t in May’21. Russian scrap A3 prices are rising due to which only around 75,000 t of scrap deals were concluded throughout Apr-May’21.
Japanese scrap prices up in May’21: SteelMint’s monthly average price assessment for Japanese H2 scrap exports rose by JPY 4,525/t ($41/t) m-o-m to JPY 48,125/t ($435) FoB in May’21.
Automotive sales up: South Korean carmakers’ global automotive sales recorded a double-digit growth in the month under review due to demand recovery from the Covid-19 pandemic shock, as per industry data. The carmakers’ automotive exports rose 29% to 548,262 units in Jun’21.
But, the total cars sold in the domestic market dipped 24% y-o-y to 134,761 in the last month owing to the shortage in semi-conductors which are used in vehicles manufacturing.
Outlook
Demand for high quality Japanese Shindachi scrap is likely to remain supported which may widen the price gap between H2 and Shindachi.
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