South Korea: Steelmakers’ ferrous scrap inventory drop continues w-o-w

South Korean steelmakers saw a continuous decline in its scrap inventory again this week. The major steelmakers had 872,000 tonnes (t) of scrap stock, lower by 8.8% w-o-w, as per a SteelDaily report.

Steelmakers are currently not in a mood to hike purchase prices. But if inventory drops at the current rate, these are projected to reach the 700,000-tonne threshold shortly. It is challenging to understand that the locked supply is only an indication that prices are bottoming out, according to a steelmaker official.

Region-wise inventory status –

• Southern region: The decrease in inventory among steelmakers in the southern region stands out in particular. The southern region’s steelmakers had 336,000 t of stock, which was a 13.8% or 54,000 t decrease from the previous week.
• Central region: The steelmakers in the central region here experienced a considerable decrease of 5.3% or 30,000 t in inventory from the previous week.

Company-wise picture-

• YK Steel and Daehan Steel: Particularly, inventory at YK Steel and Daehan Steel decreased by 30%. Stock at Korea Steel dropped by 13%. The three steelmakers in the Busan-Gyeongnam region together had 73,000 t of inventory, a 23.2% decrease from the previous week.
• Hwan Steel and Dongkuk Steel: Hwan Steel and Dongkuk Steel saw a 16.2% and a 19.6% fall in scrap inventory, respectively, from the previous week.
• POSCO: POSCO reported a drop by around 2,000 t in inventory from the previous week.

This week’s total inventory held by steelmakers was 15.4% lower than it was during the same week last year.

Ferrous scrap imports by major steelmakers-

Additionally this week, major ports in South Korea reportedly received a total of 120,110 t of ferrous scrap. The improvement was less than 1,000 tonnes from the previous week, which is almost stable w-o-w.

• Dongkuk Steel: Dongkuk Steel imported 39,260 t through Incheon Port and 26,150 t through Dangjin Port. The quantity of goods entering Dangjin Port is the quantity of large mother ships departing from Australia.
• Hyundai and POSCO Steel: Imports by POSCO and Hyundai Steel, which formerly used to import the most scrap, are still minimal.

Only 8,000 t were imported by Hyundai Steel this week. For the third week in a row, the steelmaker reported imports fewer than 10,000 t.

Meanwhile, POSCO received 2,000 t for Pohang works while its Gwangyang works received 8,000 t. Although imports were relatively modest, the company imported more than 10,000 t for the first time in seven weeks.

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