Japan: Ferrous Scrap Exports Fall 10% in 2018

Scrap imports from China and Bangladesh observed significant fall in 2018

Japan – world’s 3rd largest ferrous scrap exporter after EU and US has registered the second consecutive fall in scrap exports in 2018. As per customs data, Japan exported 7,216,515 MT ferrous scrap in 2018, down 10% Y-o-Y as against 8,054,498 MT during the same period last year. This could be a result of falling demand mainly from China and other Asian markets, on the other hand, strong domestic demand on Olympics-2020 constructions.

According to the World Steel Association, Japan’s crude steel production observed a marginal fall this year, which recorded at 104.32 MnT over the span of 2018 as against 104.66 MnT recorded during the last year. Rising EAF based steel production supported domestic scrap demand in 2018.

In Q4-2018, Japan exported 1.73 MnT ferrous scrap, down 4% Q-o-Q against 1.81 MnT in Q3-2018 while down 16% Y-o-Y against 2.05 MnT in Q4-2017.

Japanese scrap exports rise 38% in Dec’18 – The country exported 673,236 MT ferrous scrap in Dec’18, up 38% M-o-M as against 488,463 MT in Nov’18. Recovery in the demand on restocking ahead of Chinese Lunar holidays from South Korea, Vietnam and China could have led to an increase in exports in Dec’18.

Notably, scrap exports hit a year high in Dec’18 which was recorded highest earlier to this in Dec’17 at 745,994 MT, witnessing 10% fall in Dec’18 on yearly premises.

South Korea remained the largest importer of Japanese scrap – South Korea imported 343,034 MT in Dec’18, up 37% M-o-M as against 251,068 MT ferrous scrap in Nov’18 occupying highest 51% share. South Korean steelmakers resumed scrap bookings from Japan amid sharply fallen scrap Japanese prices as compared to global levels in Nov-Dec’18. Notably, South Korean imports from Japan recovered in Dec’18 after hitting 2 years low in Nov’18.

Second largest importer, Vietnam imported 174,962 MT, up 61% M-o-M followed by China (126,825 MT, +35% M-o-M), Taiwan (15,303 MT, -46% M-o-M) and Indonesia (4,755 MT, +80% M-o-M) in Dec’18. Bangladesh and Thailand observed very minor import volume in Dec’18.

Japanese scrap export prices continue downtrend in Dec’18 – Average Japanese H2 scrap prices stood at JPY 31,500/MT, FoB in Dec’18, down against JPY 34,500/MT in Nov’18. Which moved down further to an average of JPY 30,000/MT, FoB in Jan’19. Considerable fall in prices and slow domestic demand could have resulted in rising in exports in December. Latest bid of Hyundai Steel for Japanese H2 stands at JPY 28,500/MT, FoB. While Japanese Mini mill Tokyo Steel kept prices steady amid plant maintenance activities in Jan’19.

Country-wise Japan ferrous scrap exports –

Quantity in MnT,
Source: SteelMint Stats