The monthly Kanto Tetsugen ferrous scrap export tender, Japan’s scrap export price driver, was held on 9 November. According to sources, the bid price for H2 grade scrap was about JPY 49,000–50,000/t FAS, which was below the suppliers’ expected price. However, there was no bid for JPY 50,000/t, unlike the tender concluded in October.
Reasons behind low bids: Lower offers from participants resulted in the tender not getting concluded for the second time this year after May.
Bids were also impacted by the Kanto Cheorwon Cooperative’s Members’ limited ability to respond to exports due to a lack of supplies resulting from limited yard warehousing, as per a SteelDaily report.
However, limited supply kept prices high for the time being. Demand from overseas buyers such as South Korea, Vietnam, and others remained weak.
Market perspectives
The union stated: “Japan is still an exporting nation despite high domestic prices and poor export costs. …. Don’t have a pessimistic outlook on this bid.”
- The union stated that the market generation is too low and the supply capacity of member enterprises is constrained with regard to the most recent ferrous scrap market.
- Because of a scarcity of supply, it is difficult for the cooperative to respond to exports, and the situation is worse than manufacturers or trading companies think.
The next bid is expected to take place on 9 December, as per sources.
Tokyo Steel lowers bids for domestic scrap
Tokyo Steel has lowered scrap purchase bids for four of its plants, the second time after the Kanto tender failed due to lower bids. After the final revision, prices of H2 scrap stand at JPY 48,000/t ($339/t) and were delivered to the Tahara plant and JPY 48,500/t ($343/t) to Utsunomiya works, effective from 11 November.
Currency gains
The Japanese yen, however, remains volatile in November. The yen is trading at 141.68, stronger by JPY 7 compared to the beginning of this month.
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