Weekly: Global ferrous scrap market overview

Global ferrous scrap market sentiments turned bearish as no deep-sea scrap cargo bookings were reported by Turkish steel mills throughout the week. Imported scrap prices in India & Pakistan fall by around $10 w-o-w. Japanese scrap export trades slowed down as South Korean mill books Russian cargo.

Turkey – Turkish mills kept themselves away from the deep-sea scrap market this week as many steel manufacturers have sufficient scrap inventory with their mills, and this could be the reason they did not make any fresh bookings.

• Global suppliers were unwilling to drop offers below $297-$299/t CFR level.
• SteelMint’s assessment for USA origin HMS 1&2 (80:20) stands at $298/t CFR Turkey, slightly down by $3/t w-o-w.

Japan – Tokyo Steel raised its domestic scrap purchase price for Tahara and Kyushu works by JPY 1000 ($9) and JPY 500 ($5) respectively. The company would pay JPY 27,000/t ($258) for H2 scrap delivered at its Tahara plant in Central Japan and Kyushu works.

• Bid price for the other three plants i.e. Utsunomiya, Okayama and Takamatsu steel center as against the last set of prices. Prices at Tahara plant hit over fifteen-months high in Japan since the closing of Jun’19.
• Japan’s monthly Kansai scrap export tender also concluded on 15th Sep’20 and prices moved up m-o-m. The winning bid was awarded a total of 5,000 t of Japanese H2 at an average price of JPY 29,310/t ($280), FAS, in comparison with JPY 27,000/t concluded on 28th Aug’20. Bid price was higher than previous bid price, up by JPY 2,310/t ($21) putting Japanese H2 scrap export offers at JPY 28,500/t FoB Japan basis.

South Korea – Hyundai Steel- South Korea’s major steel manufacturer, has booked 80,000 t bulk scrap cargo for Russian A3 grade scrap this week. The deal was concluded at $303/t CFR Korea basis, improved significantly by $38/t against the last deal at $265/t CFR basis during the mid-Aug’20. The prices have increased on supply tightness and increased domestic demand for scrap.

• Korean buyers have not placed strong bids for Japanese scrap this week and have quoted low bids, thus widening the gap between buyers’ bids and offers.
• SteelMint’s assessment for Japanese scrap export stands at JPY 28,500/t ($272) FoB Japan, lower by JPY 500/t w-o-w.

China – China’s Shagang Steel has announced two price cuts this week for all the grades of domestic steel scrap procurement by total of RMB 60/t.

• The purchase price of HMS (6-10 mm) thickness has declined to RMB 2,740/t ($404), inclusive of 13% VAT delivering to headquarters works at Zhangjiagang North of Shanghai in China. Notably, the purchase prices are on a similar level on 11th Nov’19.
• Slow production and scrap arrival in processing plants have significantly increased. Some steel mills have lowered the procurement price. In addition to it, the steep decline in steel futures turned market sentiments bearish. SHFE rebar futures fell by RMB 60 this week.

India – Indian imported scrap prices for containerized shredded fell over a week ending as buyers stepped back amid a weak finished steel market, following the global trend. Few imported scrap bookings in containers were concluded early this week by both western & southern India based steel mills. However, the sentiments softened towards the weekend.

• SteelMint’s assessment for Shredded scrap in containers of UK origin is at $318/t CFR Nhava Sheva, down by $7/t w-o-w. Suppliers’ offers stand at around $315-322/t CFR levels.

Pakistan – Pakistan’s imported scrap market softening over the end of week, although shredded scrap demand was stronger as compared to India, with multiple deals heard.Imported scrap inquiries have slowed down as buyers are holding back purchases.

• SteelMint’s assessment for Shredded 211 scrap in containers from UK/Europe stands at $318/t CFR Qasim, down by $4 against Tuesday.

Bangladesh – Bangladeshi steel manufacturers continue to place inquiries for bulk scrap cargoes. There were a couple of bulk scrap bookings being concluded from USWC towards the end of last week.

• Containerized imported scrap offers remained more or less stable and buyers are holding back considering bearish finished steel market sentiments.
• SteelMint’s assessment for containerized shredded 211 scrap from UK/Europe origins remains unchanged at $337/t CFR Chittagong.