The ferrous scrap inventories of major South Korean steelmakers were reduced by only 12,000 t or 1% w-o-w as of 22 March. Volumes totalled 871,000 tonne (t). Even during the peak season of spring, inventories at steelmakers did not drop. Inventory depletion is particularly slow.
Region-wise inventory status-
Central region’s inventory status: Steelmakers in the central region have a total inventory of 560,000 t. It actually grew by 8,000 t from the previous week. Steelmakers in the central region had scheduled factory maintenance until March, and output was minimal. The stock level became satisfactory enough resulting into a belief that inventory was ‘piling up too much’. For example, applying stocking restrictions on specific commodities, such as raw iron, and reducing prices.
Company-wise status: Hyundai Steel’s Incheon plant inventory grew, while Dongkuk Steel and Hwan Steel saw inventory falling by less than 1%.
According to a central region steelmaker official, “looking at the existing stock condition and stocking trend, it appears that it will be possible to operate without significant price swings until demand gathers steam in April.”
Southern region’s inventory status: Southern region’s inventories were 311,000 t, down 20,000 t or 6% from the previous week, and the price hike was imposed for the first time in two months. Because inventory depletion has been modest, the gap with the same period last year is greater. This week’s inventory is 16.7% more than the same week last year.
Company-wise status: In a year and a half, Daehan Steel, YK Steel, and Hyundai Steel Pohang’s inventory all dropped below 100,000 t.
Note: This article has been published in accordance with an article exchange agreement between SteelDaily and SteelMint.
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