- Short-term inventory growth hedges post-Chuseok supply-demand volatility.
- South Korea’s ferrous scrap inventory rises for 4rd consecutive week .
SteelDaily: The cumulative ferrous scrap inventory at eight major South Korean steelmakers rose for the fourth straight week to about 815,000 tonnes (t), up 4.1% w-o-w from 769,000 t previously. Domestic steelmakers’ scrap inventories have surged nearly 120,000 t since September.
This rise is driven by aggressive supplier shipments and imports amid fears of further price cuts, alongside steelmakers preemptively stockpiling to manage potential supply and demand disruptions following the Chuseok holiday.
Region-wise inventory
This week, the central region rose to 463,000 t from 438,000 t last week (up 5.7%), while the southern region grew to 352,000 t from 331,000 t last week (up 6.3%).
Market updates
The inventory surge is mainly due to lower purchasing prices by steelmakers. As prices fell, suppliers—anticipating further declines-ramped up shipments. Combined with imports from major sources like Japan, cumulative general-purpose steel scrap imports from September to last week exceeded 100,000 t, already surpassing August’s 62,000 t.
While some companies are limiting stockpiles due to lower scrap consumption from reduced production, the overall focus remains on securing inventory.
A market participant commented that “steel manufacturers are lowering purchase prices while continuing to build inventory to prepare for post-Chuseok supply and demand volatility and in the short term, inventory growth is inevitable, but if product demand fails to recover, it could become a long-term burden.”
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