South Korean leading EAF steelmaker – Hyundai Steel has lowered its purchase bids for Japanese scrap purchase by JPY 1,000/MT (USD 9) today.
In bids presented today for Japanese scrap, the company has its reduced H2 scrap bids to JPY 26,000/MT (USD 244 ), FoB Japan as against JPY 27,000/MT (USD 253 ), FoB presented 2 months ago. While bids for other grades of scrap like H1 stood at JPY 27,000/MT, FoB, Shredded and HS scrap at JPY 29,000/MT (USD 272) and Shindachi Daichibara scrap at JPY 30,000/MT (USD 281), FoB Japan.
This the first price revision by the company in exactly 2 months, as prior to this the company had cut its purchase bid on 5th July’19 by JPY 1000/MT (USD 253) , while its bid for H2 scrap had been standing unchanged at JPY 27,000/MT FoB since the last 9 weeks.
As per the current bids for Japanese scrap by the company are its lowest price in 2 years and 3 months, as prior to this, the prices had fallen below this level in June’17 when the bids stood at around JPY 24,000-26000/MT FoB Japan.
A couple of weeks back the company had booked 50,000 MT of Japanese H2 scrap at JPY 27,000 MT FoB. However, with continuous fall in Japanese domestic scrap prices along with successive price cuts by leading Japanese mills like Tokyo Steel, it was expected the Hyundai Steel and other prominent South Korean mills will further cut its prices.
Russian cargo booking – The company also reportedly booked a Russian bulk cargo last week comprising of 30,000 MT of Russian A3 grade scrap at USD 293/MT CNF South Korea. Post several high volume bookings, Hyundai Steel has sufficient inventories available, thus it remains to be seen if there is any resistance from the Japanese suppliers in following the company’s price cuts.
Hyundai steel is the largest buyer of Japanese scrap which imports around 2.5 MnT scrap every year comprising around 30% of total Japanese yearly scrap exports. Hyundai’s bidding for Japanese scrap is considered to be the benchmark for East Asian scrap market.
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