- EAF mills reduce prices further after steep correction in Kanto tender price
- Elevated arrivals at Tokyo Steel’s 2 Kanto facilities prompt price cuts from mill
Japan’s Kanto-region ferrous scrap market came under further pressure as electric arc furnace (EAF) mills continued to reduce purchase prices following the latest Kanto export tender.
Tokyo Steel cut H2 scrap purchase prices by JPY 1,000/t ($6/t) at its Utsunomiya plant and Tokyo Bay Satellite Yard, effective 8 August. Other EAF producers followed with similar reductions, bringing prevailing H2 purchase prices in the Kanto region to around JPY 47,500-48,500/t ($298-304/t) by 10 August.
Tokyo Steel said the cuts were aimed at responding to the earlier decline in Kanto export scrap prices and adjusting high incoming volumes. Arrivals at its two Kanto facilities remained elevated, prompting mills to reduce prices to manage inventories.
The latest reductions followed the Kanto Tetsugen export tender on 7 August, where 20,000 t of H2 scrap were awarded at an average JPY 49,086/t ($308/t) FAS. The price was significantly below the previous month’s winning bid of JPY 52,508/t ($329/t), reinforcing downward pressure on domestic purchase prices.
Tokyo Steel also reduced prices by JPY 500-1,000/t ($3-6/t) at other locations. The lower JPY 500/t ($3/t) reductions at Tahara and Nagoya were intended to maintain domestic inbound volumes, while the Kansai cut was limited to JPY 500/t ($3/t) amid regional supply-demand considerations.
Market participants noted that prices below JPY 49,000/t ($307/t) appeared increasingly difficult to justify from an export-competition perspective. The next Kanto tender is scheduled after the Obon holiday, with around 10,000 t expected to be shipped between 18 and 24 August. The relatively high shipping cost compared with the previous tender could provide some support to export prices.
As of 10 August, Kanto H2 scrap prices were heard around JPY 45,500-47,000/t ($286-295/t), indicating continued pressure on domestic scrap values. However, the upcoming tender and potentially tighter post-Obon availability could offer some direction to the market.
This article has been published in accordance with a content exchange agreement between Japan Metal Daily and BigMint.
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