The uptrend in the Asian market continues as South Korean steel producers have in succession announced higher bids for Japanese scrap, while US scrap suppliers are also insisting on higher prices to South Korea.
As compared to the levels announced on January 20, Hyundai Steel has increased its bid for H2 grade by JPY 1,000/mt ($8.7/mt) to JPY 52,000/mt ($456/mt) FOB. The level in question is now in the range of domestic H2 grade scrap prices in Japan, which stand at JPY 51,000-54,000/mt ($448-474/mt) delivered. The decreases observed in the local Japanese market have also halted, with the prices of Tokyo Steel stable since January 13. On the other hand, Japanese suppliers’ export offers for H2 are currently in the range of JPY 53,000-54,000/mt ($465-474/mt) FOB.
As a result, SteelOrbis’ ex-Japan H2 reference price has increased by JPY 1,000/mt ($9/mt) since last week to JPY 52,000-53,000/mt ($455-464/mt) FOB.
Hyundai’s bids for HS scrap have remained stable at JPY 60,000/mt ($527/mt) FOB. On January 24, SeAH Besteel’s bids for HS scrap were at JPY 63,000/mt CFR or JPY 60,000/mt FOB.
Hyundai bids for shredded and shindachi bara grades have increased by JPY 500/mt ($4.4/mt) and JPY 1,500/mt ($13.2/mt) to JPY 58,500/mt ($513/mt) and JPY 59,500/mt ($522/mt), respectively both on FOB basis. For shredded and shindachi bara, SeAH Besteel announced its bids at JPY 62,000/mt CFR and JPY 61,000/mt CFR on January 24, or at JPY 59,000/mt FOB and JPY 58,000/mt FOB.
There are rumors of ex-US HMS I 80:20 scrap offers to South Korea at $540/mt CFR, SteelOrbis learns. The previous purchases of ex-US HMS I scrap were done at $524/mt CFR and $525/mt CFR. No HMS I scrap offer or deal has been heard from the US this week.
According to the Korea Times, “The Fair Trade Commission (FTC) has started a procedure to levy at least KRW 120 billion ($100 million) combined in fines on Hyundai Steel, Dongkuk Steel, KISCO and nine other companies. Six steelmakers and another six rolling mill operators are suspected of having colluded between 2012 and 2016 to fix prices during their bids to supply rebar to the central and regional governments, the antitrust agency said. Once the FTC finalizes the sanction, the companies may be excluded from bidding for public projects. They can also face lawsuits from the central and regional governments.”
On the other hand, Hyundai Steel has kept its domestic scrap prices at its Pohang, Incheon and Dangjin plants for weight A scrap purchases stable since January 20 at KRW 630,000-640,000/mt ($526-534/mt). Dongkuk’s price for the same grade is also unchanged at KRW 630,000-645,000/mt ($526-538/mt). A similar trend is seen in Daehan Steel’s quotations which remain at KRW 640,000/mt ($534/mt).
$1 = JPY 113.94
$1 = KRW 1,197.8