The Week that was: Global ferrous scrap market overview

• China lifts restriction on imports of steel scrap for five grades from 1 Jan’21
• Imported scrap prices to South Asia soared by around $30 this week
• Trades in global scrap market likely to pick up from mid-next week

China’s steel scrap import volumes to rise as it lifts restrictions on five grades – On 31st Dec’20, the Ministry of Industry and Information Technology jointly issued a notice to confirm the free import of recycled raw material for steelmaking with effect from 1st Jan’21. Recycled steel raw materials that meet the standards of “Recycled Steel Raw Materials” (GB/T 39733-2020) are no longer regarded as solid waste and can be imported freely. The new standard is likely to boost Chinese ferrous scrap import volumes.Chinese buyers are expected to focus more on higher grade scrap such as PNS and Busheling. Chinese steelmakers expect to import initially around 6-7 mn t of scrap annually. However, country’s scrap import volume is likely to reach around 12-15 mn t in the next year.

• Turkey’s imported scrap prices stable in a quiet holiday market – Turkey import scrap prices were unchanged this week on account of holidays after several deals were concluded in the last couple of weeks. Major supplying countries are now closed for business and the market is expected to resume after 4th Jan’21 with an increase in offer prices. SteelMint’s assessment for USA origin HMS 1&2 (80:20) stands at $478/t CFR Turkey, up by $3/t against last week.
• India’s imported scrap market observes less trades at increased offers – Imported scrap market in India has slowed down this week as global market insiders kept themselves away from the market on this weekend’s new-year holidays. Buyers are waiting for fresh offers to be quoted by the global suppliers. In India there is no buying at the moment as there is sufficient inventory with the steel mills. SteelMint’s assessment for Shredded scrap in containers of UK/EU origin stands at $478/t CFR Nhava Sheva, moving up by $18/t w-o-w.
• Bangladesh buyers remain less active on bid-offer disparity – Bulk scrap market in Bangladesh has slowed down during the last week of Dec’20 and witnessed limited activities on high offers amid disparity between offers and bids. Imported scrap prices are not matching with the finished steel prices, high level of offers is not acceptable by the buyers at the moment. Thus, buyers have adopted ‘wait & watch’ approach this week for imported scrap bookings. US origin bulk HMS offers to Bangladesh are being quoted at $500-510/t CFR Chittagong levelSteelMint’s assessment for containerized shredded stands at $483/t CFR Chittagong level, up by $13/t w-o-w.
• Pakistan mills raise rebar prices on higher imported scrap cost – Pakistan’s domestic rebar prices have moved up by over PKR 8,000/t further this week, following the global scrap price uptrend. Currently, rebar (deformed-60) prices are being quoted at PKR 128,000-130,000/t exw level by major players in the market. Imported scrap offers to Pakistan have soared by $30 this week. SteelMint’s assessment for imported shredded 211 scrap in containers from UK/Europe stands at $475/t CFR Qasim, moving up considerably by $20/t compared to the beginning of last week.
• Tokyo Steel kept scrap purchase prices unchanged this week – Japan’s leading EAF mill- Tokyo Steel remained silent this week after continuous hikes in scrap purchase price. According to the latest revision the company would now pay JPY 43,000/t ($416) for H2-scrap delivered at both Tahara and Utsunomiya works.
• Shagang Steel scrap purchase price unmoved – Eastern China’s largest EAF steelmaker- Shagang Group has kept its scrap purchase price unchanged from last week. The company had raised prices by RMB 80/t ($12) for all grades on 21st Dec’20. The purchase price of HMS (6-10 mm) thickness has stood at RMB 3,020/t ($462), inclusive of 13% VAT delivering to headquarters works at Zhangjiagang North of Shanghai in China.
• Japanese scrap export prices remain stable – Japanese scrap offers have remained unchanged from previous week. Suppliers have quoted around JPY 44,000-45,000/t FoB basis for H2 to South Korea. SteelMint’s assessment for Japanese H2 now stands at JPY 44,500/t FoB level. Bulk Japanese H2 scrap offers for Vietnam and Bangladesh currently stands at $470/t and $495/t CFR basis respectively.