China imported ferrous scrap 71,433 tonnes (t) of the material in Apr’21, up by 127% from 31,496 t in Mar’21, as per data recorded with SteelMint.
However, on a year-on-year (y-o-y) basis, import volumes in Apr’21 jumped four-fold as compared to a mere 2013 t Apr’20. Since China resumed recycled steel raw material imports from Jan’21, a total volume of 110,035 t has been imported till Apr’21, up from 5,379 t in Jan-Apr’20.
Imports from Japan rise sharply: Japan continued to be the largest scrap supplier to China in Apr’21 at 51,299 t, a jump of more than 150% m-o-m against 20,493 t in Mar’21. South Korea was the second largest importer, also up sharply m-o-m , whereas, imports from Hong Kong were recorded at 2,097 t in Apr’21, a drop of 4% m-o-m against 2,183 t in Mar’21.
Rise in China’s imported scrap prices in Apr: Bids by Chinese steel mills for the most preferred Japanese HRS 101 grade rose in Apr’21. SteelMint’s monthly average record for Japanese HRS 101 scrap are at $527/t, CFR China. Limited deals were concluded in Apr’21 owing to the Golden Week holidays.
However, in May’21, a huge disparity in bids and offers kept bookings limited. Strong domestic scrap demand in Japan on successive price hikes by Tokyo Steel and low buying interest contributed to lower bids for imported scrap.
Domestic scrap prices rise further in Mar’21: Shagang Steel increased its domestic scrap purchase prices for HMS 6-10 mm grade by a total RMB 3,390/t ($532/t) in Mar’21, slightly up by 3% from RMB 3,290/t ($517/t) in Feb’21. Hike in global scrap prices, along with improved semi-finished steel prices, supported the scrap purchase price hike.
Billet imports increase 22% in Apr’21: Steel billet imports by China rose 22% in Apr’21 to 750,547 t. Vietnam, Indonesia, Malaysia, India and Iran were the predominant suppliers for the month, according to data maintained with SteelMint. The rise in imports was due to increased supply from Vietnam and Indonesia. Imports from these countries witnessed a two to four-fold rise m-o-m. As China has slashed the import duty on non-ASEAN-origin billets, imports are expected to increase in May’21.
Outlook
A further rise in scrap imports can be seen after the lifting of restrictions and continued restocking of scrap by Chinese mills.
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