Japanese steel major, Nippon Steel, has increased its hot-rolled coils (HRCs) export offers for May 2023 shipments. Offers are currently assessed $850/t CFR EU and $800/t CFR Asia. Previous offers stood at $750/t CFR for March shipment, as per data maintained with SteelMint. The company said that it has closed all April shipments negotiation and is now moving to offering for the following month.
Factors behind the increase in export offers-
1. Supporting global steel prices: The overseas markets have gained momentum with steel prices rising against the backdrop of high costs. In Asia, Vietnam’s Formosa Ha Tinh Steel (FHS) has announced a price hike of $33/t for May deliveries while China’s Baosteel, world’s leading steelmaker, has also raised its monthly HRC prices by RMB 200/t ($29/t) for April.
2. Increasing steel exports: Japan’s steel exports inched up 2.5% y-o-y to 2.602 million tonnes (mnt) in February 2023 (provisional volumes). This is the second consecutive month of a slight growth. Exports to the ASEAN increased by 4.3% to 853,000 t and to South Korea by 16.4% to 536,000 t. Exports to the EU increased by 2.4% to 133,000 t. Shipments to the US increased by 38.1% to 107,000 t while those to the Middle East rose by 68.8% to 32,000 t.
Furthermore, the country’s export volumes are expected to pick up the pace from March with the completion of the regular renovation of Japan Steel’s hot-rolling mill, located in the Oita area in the Kyushu Works.
3. High raw material costs: Japan’s bellwether Kanto Tetsugen scrap export tender was concluded on 9 March. A total of 18,100 t of scrap was awarded, with the average price at around JPY 55,438/t ($423/t) FAS for H2 grade. Bid prices increased by JPY 2,076/t ($16/t) m-o-m compared to bids in February. The first bid was placed for 3,100 t at JPY 55,680/t ($425/t) FAS to Taiwan, while the second was for 15,000 t at JPY 55,388/t ($423/t) FAS to Bangladesh. As many as fifteen companies participated in the tender, according to sources.
Global iron ore prices are also increasing. Benchmark Fe 62% fines prices inched up by $3/t m-o-m to $129/t CNF China in March (till 21st) against $126/t CNF in the previous month.
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