Price in Japan’s Kanto scrap export tender rises by $8/mt, S. Korea returns to import scrap market

Tuesday, 16 January 2024 17:31:04 (GMT+3)   |   Istanbul
       

Prices recorded in Japan’s Kanto scrap export tender have increased as compared to the levels recorded in December, while the total tonnage changing hands has also increased. Market participants indicate mixed expectations for the future trend of scrap prices in the region, while South Korean sources report that, despite the bids coming from South Korea, its demand for scrap is declining. On the other hand, a Japanese source confirmed that major South Korean producer SeAH is looking for Japanese scrap, since “one of its electric furnaces is restarting operations, so it has to buy more raw material.”

In the Kanto tender, the highest bid was at JPY 53,081/mt FAS, indicating an increase by JPY 2,061/mt as compared to the levels recorded in early December. The dollar-based prices have increased from $354/mt to $362/mt from last month.

SteelOrbis has learned that 15,000 mt of scrap have changed hands in the tender, while the buyer is Bangladeshi. The FAS prices are equal to JPY 54,081/mt FOB or $369/mt FOB. Meanwhile, market prices in the Kanto region are currently at JPY 51,000/mt FAS on average. According to a Japanese source, domestic H2 grade in Japan is priced in the range of JPY 51,000-51,500/mt ($348-351/mt).

There was a rumour of a South Korean producer concluding a deal for Japanese H2 scrap at JPY 53,500/mt CFR (JPY 50,762- 51,055/mt FOB) earlier this week. Although this deal was not confirmed by Japanese or South Korean contacts, most believe the price is in fact a workable one, considering the domestic scrap quotations in Japan. A Japanese source said, “The origin may be the Kyushu area because ocean freight is very cheap even if the yen remains weak against the US dollar. [The freight from Kyushu to South Korea] may be around $17-19/mt. But sometimes vessels accept cheap freight to get work to go back to South Korea.” A South Korean source said that this deal was not done. Another South Korean source said this transaction was not confirmed but the price in question was “definitely the market price and yet with not much momentum because demand is slowing down.”

$1 = JPY 146.69


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