China’s recycled steel raw materials, or ferrous scrap, import volumes in Aug’21 witnessed a 54% drop on a m-o-m basis. Scrap imports into China fell as preference was more for semi-finished steel as an alternative to ferrous scrap which led to bid-offer disparities in imported scrap.
The world’s leading steel producer imported 40,540 tonnes (t) of recycled steel raw materials in Aug’21 a sharp decline of 54% m-o-m as compared to 88,218 t last month, as per customs data collated by SteelMint.
However, on a y-o-y basis, the Chinese market saw a significant hike in imports compared with 4,300 t in Aug’20.
Chinese market highlights
- Imports from Japan fall: Chinese mills witnessed import volumes of scrap from Japan at 28,722 t in Aug’21, a sharp drop of 57% as against 66,096 t in the earlier month. The bid-offer disparity prevented Chinese mills from concluding deals for Japanese ferrous scrap traders. Higher domestic demand held back Japanese suppliers from lowering their scrap export offers.
- Scrap import volumes from South Korea drop: The South Korean mills exported scrap totalling 5,637 t in Aug’21, resulting in a massive fall of 61% as compared to 14,464 t in the last month.
- Price trends
Offers for Japanese HRS 101-grade ferrous scrap rose to $585/t CFR China in Jul’21 from $560/t CFR China in Jun’21, according to SteelMint data.
Outlook
Chinese steel mills appear less interested in procuring scrap, as they are actively buying semi-finished products (billets) at more favourable prices which may keep scrap import volumes on the lower side.
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