Amid increased operating hours on low electricity prices, EAF steelmakers in Japan have started restocking scrap.
Japan’s leading EAF steel mini-mill – Tokyo Steel has announced second price hike in August for its scrap purchase prices at all five plants. As per new price circular released, the steel manufacturer has raised prices by JPY 1000/MT (USD 9) at all five plants against last set of prices except three high grade scrap at Utsunomiya plant for which the company has raised bids by JPY 1500 (USD 14) amid tightened supply. Revised prices shall be effective from tomorrow i.e. 18th Aug’18.
Tokyo Steel fetches H2 scrap at JPY 37,000/MT (USD 334) for its Kanto region based works i.e. Utsunomiya and at JPY 36,500/MT for largest works in central Japan-Tahara. After this price hike, bids for the same grade has increased to JPY 35,500/MT levels at Kyushu plant and JPY 35,000/MT at Okayama works in Western Japan while for its Takamatsu Steel Center company keeps bids at JPY 34,500/MT in Southern Japan.
Earlier to this, on 09th August, Tokyo Steel increased prices at Utsunomiya and Tahara plant by JPY 500/MT and by JPY 1000/MT at other three western Japan based works. After witnessing holidays for Oban festival during 13th-16th Aug’18 in Japan. All EAF steelmakers have resumed activities with increasing demand for restocking of scrap amid increasing operating hours.
H2 price gap between Okayama and Utsunomiya plant has remained to JPY 2,000/MT now.
Tokyo Steel’s scrap purchase prices effective from 18th Aug’18 –
| Scrap Grade | Name of Work of Tokyo Steel | ||||
| Tahara Plant | Okayama Plant | Kyushu Factory | Utsunomiya Factory | Takamatsu Steel Center | |
| Special Class | 36,500 | 35,000 | 35,500 | 37,000 | 34,500 |
| First Grade | 36,000 | 34,500 | 35,000 | 37,000 | 34,000 |
| Second Grade | 34,500 | 33,000 | 33,500 | 35,500 | 32,500 |
| New Cutting Press A | 41,500 | 37,000 | 37,500 | 40,500 | 36,500 |
| Shredder A | 37,000 | 35,500 | 36,000 | 37,500 | 35,000 |
| Shredder C | 36,500 | 35,000 | 35,500 | 37,000 | 34,500 |
Prices in Japanese Yen/MT for transport on land
Source: Tokyo Steel Reports
Japanese sellers focus on domestic market amid sluggish scrap exports – Buying activities by major EAF steelmakers for scrap remain good in local market in Japan. However, purchase bids placed by major South Korean steelmakers like Hyundai and Dongkuk stood still very low as compared to suppliers’ expectations and exports remain sluggish amid sharply declined global scrap prices.
According to price index reported by Japan Iron and Steel Association, the average price index for H2 scrap stood at JPY 33,100/MT (USD 299) almost stable on W-o-W basis.
South Korean domestic scrap prices on uptrend amid supply shortage – Leading South Korean steelmakers raised scrap purchase prices by KRW 5,000-10,000/MT (USD 5-9) in last couple of days amid supply shortage and quality problem. According to reports, lot of impurities are being added into local ferrous scrap in South Korea making it unfit to purchase and consume also sometimes resulting in poor quality finish products and financial losses.
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