South Korean mills raise bids for Japanese scrap

Japanese scrap export offers have increased sharply, following hike in bids in the monthly “Kanto Tetsugen” tender concluded early this week.  Currently, Japanese suppliers are quoting around JPY 29,000-29,500/t ($273-278) FoB basis for H2 scrap, SteelMint learnt from traders. SteelMint assessment for Japanese scrap export offers stands at JPY 29,000/t FoB ($273), up by JPY 1,000/t w-o-w.

South Korea’s major steelmaker – Hyundai Steel presented bids for Japanese scrap purchase recently. Hyundai Steel had put up bids for Japanese H2 scrap at JPY 28,000/t ($264) FoB Japan level, up by JPY 1,000/t against the last bid made by the company at JPY 27,000/t towards the end of Aug’20. It also raised bids for other high grades of Japanese scrap.

Hyundai Steel’s bid for Japanese scrap

Hyundai Steel’s scrap consumption may lower slightly on planned maintenance – Notably, the company may reduce it’s scrap consumption from mid of Sep to Oct ’20, due to large scale maintenance work in its electric furnace at Incheon plant. With this maintenance work, around 150,000 t of scrap consumption may decrease only in electric furnace, as per SteelDaily reports.

Notably, a total of 20,000 t of Japanese H2 scrap was sold at an average price of JPY 29,370/t FAS basis, at Kanto Tetsugen – Japan’s monthly ferrous scrap export tender for Sep’20. The bid price has increased by JPY 2,154 ($20) as compared to the previous tender in Aug’20 was concluded at JPY 27,216/t. Interestingly, Kanto bid prices are highest since Jun’19, when the tender result was concluded at JPY 28,967/t FAS basis, as per data maintained with SteelMint.

Japanese scrap export offers for Vietnam up further  – Vietnam’s imported scrap offers for Japanese H2 have increased significantly over $10 w-o-w, SteelMint learnt from trade sources. Currently, H2 offers stand at $312-315/t CFR level. Japanese scrap export offers have moved up after a considerable hike in Kanto tender results.

Outlook – Japan’s domestic scrap purchase price may increase further on account of sharp hike in global scrap prices, mainly in Utsunomiya Plant in Kanto region.