Global Ferrous Scrap Market Overview-Week 50

This week global ferrous scrap market witnessed bullish marching up in scrap offers. Importers in Turkey were quite active and concluded around 13-14 bulk cargo trades for January shipments despite prices hiked by almost USD 20/MT in Turkey W-o-W. Following which, prices in all other major scrap markets showed upward movement again in this week. Hyundai Steel lifted scrap buying bids by USD 9/MT further. Tokyo Steel in Japan raised domestic scrap purchase prices by up to USD 9/MT at its all works. Other major scrap recyclers like Daehan Steel in South Korea raised Japanese scrap purchase prices further. While imported ferrous scrap offers to India, Pakistan and Bangladesh hiked around USD 7-10/MT on W-o-W basis.

Turkey imported scrap offers moved up further by USD 20/MT in recent trade deals – This week Turkish market witnessed around 14 scrap deals despite of increasing offer levels. Assessment for US origin HMS 1&2(80:20) now stood at USD 350/MT, CFR Turkey. In a recent trade deal concluded, Iskenderun steelmaker bought 18,000 MT HMS 1&2 (75:25), 13,000 MT Bonus, 5,000 MT Shredded and 4,000 MT Busheling scrap at an average price of USD 350/MT from TSR Netherlands. In another deal, Habas Steel mill in Turkey purchased HMS 1&2 (80:20) at USD 352/MT, CFR and Bonus at USD 362/MT, CFR Turkey for January shipment from a Baltic supplier.

Tokyo Steel raise domestic scrap purchase prices further by upto USD 9/MT – Japan’s leading steel producer Tokyo Steel has raised domestic scrap buying prices further by USD 9/MT(JPY 1000) at its Utsunomiya work while prices have raised by USD 5/MT (JPY 500) at all other works on 6th Dec in Japan. Now H2 scrap fetches JPY 36,000/MT (USD 317) at largest work in central Japan-Tahara. While the same grade fetches JPY 35,500/MT (USD 313) at Utsunomiya works in north Japan, H2 bids are placed at JPY 35,000/MT(USD 309) for Okayama and Kyushu works in west Japan while for its Takamatsu Steel Center company keeps bids at JPY 34,500/MT (USD 304).

Hyundai Steel raised Japanese scrap buying bids further by USD 9/MT – South Korean leading EAF steel maker-Hyundai Steel raised the bid prices for Japanese H2 scrap to JPY 35,000/MT (USD 309) FoB Japan, against last bids at JPY 34,000/MT (USD 299/MT) placed on 28th Nov. Recently, another leading steel mill- Daehan Steel raised its bid price for Japanese H2 scrap to Yen 36,000/MT FoB Japan. Following which South Korean steel mills have already placed the bid at Yen 35,500-36,000/MT (USD 313-317/MT) for Japanese H2 scrap. Thus trade sources are of the view that at these bid levels it looks difficult if Hyundai Steel will be awarded the cargo.

Indian scrap importers remained less active over sharply rising offers – Following global trend this week imported scrap offers to India moved up further by USD 5-10/MT on weekly basis. Buying interest remained still at quite lower levels than global price levels and limited offers heard as most of the suppliers are almost sold out. Offers for Shredded scrap and HMS 1&2 (80:20) in containers assessed from UK increased to USD 355/MT and USD 325/MT, CFR Nhava Sheva respectively. HMS offers from West Africa were fairly competitive at USD 305-315/MT, CFR Nhava Sheva depending on loading volumes but bookings remained still subdued. Offers assessed for Dubai origin HMS 1 were above USD 320/MT, CFR Nhava Sheva. Currently, HMS 1&2 (80:20) in Mumbai as well as in Chennai is assessed around INR 22,000/MT (Basic prices, GST@18% extra).

Pakistan scrap importers slowed down slightly amid rising offers – Imported scrap offers in Pakistan kept climbing up again this week. Current price assessment for containerized Shredded scrap from UK and Europe origins is at USD 360/MT, CFR Qasim. While last deal for Shredded scrap was reported at USD 355/MT, CFR port Qasim. Inventories in Pakistan for ferrous scrap are about to dry up soon. But most of the buyers are resisting these levels and waiting for domestic billet prices to improve further which are at standstill now in order to resume buying soon. Rising imported scrap prices have pushed up domestic scrap offers in Pakistan amid limited availability.

Imported Scrap trades in Bangladesh remain low, ship breaking scrap prices rise sharply – Price assessment for Shredded scrap in containers increased this week to USD 360-365/MT, CFR Chittagong. Offers for Dubai HMS stood at USD 335/MT, CFR While P&S from Brazil assessed at USD 350/MT, CFR Chittagong. Prices for ship breaking assessed at USD 420/LDT for general cargo and USD 430/LDT, CFR for tanker cargoes. Recently Bangladesh Roads and Highways Department (BRHD) has imposed a weight restriction on gross vehicle weight (GVW) which is 40 MT. This means maximum cargo tonnage a container (20ft or 40ft) can carry, is 22 MT. This announcement is likely to make the containerized scrap and sponge imports costlier as with weight restrictions per MT freight will also move up in Bangladesh.

Global scrap reference prices as on 09 Dec’17 –

Exchange Rate 1 USD = 113.48 JPY.
Source: SteelMint Research