Weekly round-up: Global ferrous scrap prices head south in major markets

• Tokyo Steel drops scrap buying prices for the first time in July.
• Kanto export tender drops by $12/t m-o-m.
• Price gap between H2 and high grade Japanese scrap widens after Hyundai bids.
• South Asian markets less active for scrap imports except Pakistan.

• Turkey scrap prices stay range-bound: Turkey actively booked ferrous scrap and the market saw a flurry of deals this week. However, despite favourable offers for deep-sea cargoes from suppliers, limited deals have been recorded owing to dull finished steel demand from both the overseas and domestic markets. SteelMint’s assessment for US-origin HMS 1&2 (80:20) stands at $496/tonne (t) CFR Turkey, marginally down by $1/t against last week.
• Japan’s Kanto scrap export tender fall m-o-m: Japan’s monthly Kanto Tetsugen scrap export tender for Jul’21 was concluded on 9 Jul’21. A total of around 14,000 tonnes (t) of Japanese H2 scrap were awarded at an average price of JPY 47,888/t ($436), FAS. The highest bid is lower by JPY 1,307 ($12) against last month’s tender concluded at JPY 49,195/t levels. After the tender results, Japanese H2 scrap export prices may see some adjustments from the prevailing levels. However, high-grade prices are less likely to fall on demand-supply mismatches, SteelMint understands.
• Hyundai Steel raises bids for high-grade Japanese scrap: South Korean steel major Hyundai Steel has increased bids for high-grade Japanese ferrous scrap by up to JPY 7,500/t ($68) against last month’s assessment, as per SteelMint reports. Bids for Shindachibara grade scrap have settled at JPY 64,500/t FoB, up by JPY 7,500/t. Bids for shredded scrap have increased by JPY 3,000/t to JPY 58,000/t FoB. Higher demand from Korean mills resulted in a rise in bids and the price gap between H2 and Shindachibara has widened to JPY 16,500/t from the earlier JPY 9,000/t.
• Tokyo Steel lowers scrap buying prices: Japan’s leading EAF steel mill, Tokyo Steel, announced scrap procurement price revision on 9 Jul’21. The company decreased prices by JPY 500/t ($5) for two of its works -Tahara and Kushu. After the revision, the company would pay a bid price for H2 scrap at JPY 51,000/t ($464) for the Tahara works, although prices remain unchanged for the other three works, including Utsunomiya. The decline in prices is in line with market expectations after bids dropped by $12/t m-o-m at the Kanto export tender.
• Offers for Vietnam fall: Imported scrap trade in Vietnam remained mostly absent, also scrap offers from Japan declined. Less demand for finished steel and discrepancy in bids and offers remained a major issue, resulting in fewer number of trades in the last few weeks. Japanese scrap offers for H2 remained at $495/t CFR Vietnam levels, down by $5. However, no fresh deal has been heard at this level.
• Chinese buyers quiet for Japanese scrap:Chinese buyers have continued to bid low for imported Japanese HRS 101 grade scrap. Thus, the bid-offer disparity has kept trading muted. Bids are hovering around $520/t CFR levels against the offers of $570-600/t CFR. Chinese mills are showing more interest in billets, which is now available at $675-685/t CFR levels.
• Shagang scrap purchase prices unaffected: China’s largest electric-arc furnace (EAF) steelmaker, Jiangsu Shagang Group, kept its scrap purchase prices untouched this week as well, for all grades. As per latest revisions, prices for HMS (6-10 mm) were at RMB 3,770/t ($584/t), inclusive of 13% VAT, delivered to headquarters. Tight material availability and rising prices of finished steel lifted scrap purchase prices.
• Bangladesh market remains quiet: Covid-19 restrictions have impacted trading in the imported scrap market. In addition to it, upcoming Eid will slow down activities throughout the month. The containerised scrap market stayed muted, due to the ongoing lockdown. Buyers opted to wait and watch the market silently, with limited bookings heard in the last seven days, SteelMint understands. SteelMint’s imported scrap price assessment for UK-origin shredded stood at $555-560/t CFR levels, up by around $5/t against last week.
• Pakistan scrap prices up: Ferrous scrap import prices into Pakistan moved up slightly on the back of bullish market sentiments. The hike in raw material prices at domestic and international levels led to a rise in rebar prices. Deals for 7,000 t of containerised shredded scrap were reported at $543-548/t CFR Port Qasim. SteelMint’s bi-weekly price assessment for shredded scrap stands at $545/t CFR Port Qasim, up by $2/t against the beginning of this week.

Pakistan’s steel mills have lifted rebar prices due mainly to domestic shortage and a sharp hike in raw materials costs. Offers have risen by around PKR 6,000/t exw-Punjab, and are currently at PKR 155,000-157,000/t exw-Punjab.

• India’s imported market dull: India’s imported scrap market remained subdued this week owing to variations in bids and offers. No major deals were heard throughout the week. Offers remained at the higher levels, slightly changed against last week. The north Indian market witnessed negative sentiments on limited demand for scrap, as the electricity crisis remained a major issue. Hence, steel production dropped drastically. However, other major steel producers were looking for domestic scrap, as the imported variety was less feasible. SteelMint’s imported scrap price assessment for UK-origin shredded stood at $540-545/ (t) CFR levels, up by around $5/t w-o-w.