South Korea: Mills raise scrap imports in Q1CY22 on lower domestic generation

South Korea, a major ferrous scrap consuming country, noticed a considerable drop in domestic scrap generation in Q1CY22. This impacted the domestic mills, leading them to raise their imports in order to make up for the shortage, SteelDaily reported.

Domestic scrap supply reached 1.56 mnt in March 2022, a fall of around 14% y-o-y. Due to the rise in prices, supply was limited in Q1CY22. As a result, domestic scrap supply was 4.17 mnt, a fall by 7% compared to CPLY.

However, the supply shortage seemed to ease as imports improved significantly in March shipments. According to data maintained with SteelMint, South Korea’s scrap imports rose sharply by two-fold to 0.56 mnt in March 2022 vis-a-vis 0.29 mnt in March 2021. Interestingly, monthly import volumes climbed to nearly a 3-year high in March 2022.

Mills need to pile up stocks which can lead to a price hike in mid-May and can further create a supply shortage in domestic scrap. Besides, it is likely that global scrap prices could rebound after Ramadan and end of the Golden Week holidays in early May owing to a pick-up in demand. It has been forecast that in May, the market would be different as demand will normalise in Korea.

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