- Japanese export scrap sentiment strengthens
- Vietnam buyers cautious as freight uncertainty persists
East Asian scrap markets strengthened during the week, supported by rising Japanese export prices and tightening supply conditions. Sentiment improved after Japan’s Kanto-Tetsugen tender cleared at a multi-month high, while geopolitical tensions in the Middle East pushed freight costs higher and supported bullish expectations across the region.
Despite stronger supplier sentiment, buying activity in Vietnam remained mixed, with some mills staying cautious while others sought cargoes to replenish inventories amid concerns that prices could rise further.
Weekly assessments
- Japanese H2 scrap was at $356/t CFR Vietnam, up by $11/t w-o-w.
- H2 scrap was at JPY 49,500/t ($311/t) FOB Tokyo Bay, up by JPY 2,000/t ($13/t) w-o-w.
- US-origin HMS 80:20 bulk stood at $376/t CFR Vietnam, up by $9/t w-o-w.
Japan: Scrap prices surge after Kanto tender
Japanese ferrous scrap export sentiment strengthened after the third Kanto-Tetsugen tender of the year cleared at a 19-month high. A 20,000-t H2 cargo was sold at JPY 50,121/t ($317/t) FAS, up JPY 2,038/t ($13/t) from February, marking the eighth consecutive monthly increase. The tender price equated to around $325/t FOB Japan, with the cargo likely sold to a Bangladesh mill at about $390/t CFR Chattogram.
Freight rates surged amid ongoing Middle East tensions, rising to around $65/t from about $45/t previously, with some shippers imposing additional surcharges.
During the week, H2 export offers were heard at JPY 48,500-49,500/t ($305-311/t) FOB Japan, supported by tight supply and a weaker JPY. Meanwhile, Tokyo Steel raised scrap procurement prices by JPY 2,000/t ($13/t) across plants, lifting domestic H2 purchase prices to around JPY 48,000-48,500/t ($302-305/t) and reinforcing bullish market sentiment.
Vietnam: Buyers cautious but restocking demand emerges
Vietnam’s imported scrap market remained cautious, though some mills sought cargoes amid tightening supply and rising prices. Japanese H2 offers were heard at $365-370/t CFR Vietnam, with bids near $355-358/t and tradable levels around $362/t CFR.
Domestic scrap prices were stable to firm, with HMS bids at VND 8,300-8,900/kg ($316-339/t) delivered to southern mills and VND 8,700-9,700/kg ($331-369/t) in the north.
Some Vietnamese mills stayed on the sidelines due to freight uncertainty and sufficient short-term inventories, while others sought cargoes to restock, with stocks at some mills reportedly covering around one month of production.
Outlook
Japanese export scrap prices are expected to remain firm in the near term, supported by tight domestic supply, higher freight costs, and continued geopolitical uncertainty. In Vietnam, buying activity may remain selective as mills monitor freight developments and price trends, although restocking needs could support transactions if sellers continue to push offers higher.
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