South Korean steelmaker POSCO has announced bids for Japanese scrap, keeping its H2 scrap prices relatively stable. However, market sources report that the bids shared with Japan are higher than the producer’s domestic scrap procurement prices. The South Korean steel industry successfully satisfies its scrap needs from the local market, with the share of domestic scrap remaining higher than 90 percent for months now.
POSCO has shared bids for Japanese shredded scrap at JPY 57,500/mt ($366/mt) CFR, the same on Japanese yen basis compared to the producer’s previous bid for this grade on May 21. This level indicates FOB-based prices for Japanese shredded scrap are at around JPY 54,500/mt ($347/mt, down by $2/mt amid exchange rate fluctuations).
Considering the gap between ex-Japan shredded and H2 scrap prices at around JPY 3,000-4,000/mt, this means indications for ex-Japan H2 prices for South Korea are still at JPY 50,500-51,500/mt FOB, but have softened to $321-328/mt FOB on US dollar basis due to changes in the yen-dollar exchange rate.
Additionally, market sources report that POSCO has shared bids for Japanese HS grade scrap and shindachi scrap both at JPY 58,000/mt ($369/mt) CFR.
$1 = JPY 156.14