Both in Vietnam and South Korea, steel producers have preferred to work with domestic scrap. While some interest for import scrap in Vietnam is observed this week, it was still limited.
SteelOrbis has learned that Japanese H2 scrap offers to Vietnam are in the range of $370-380/mt CFR. Buyers are willing to accept the lower end of ex-Japan offers.
This week, Tokyo Bay FAS-based prices for H2 grade scrap have been at JPY 50,000-51,000/mt ($320-327/mt). This level shows that FOB prices are at JPY 51,000-52,000/mt ($327-334/mt) for this grade. Meanwhile, ex-Japan HS scrap prices are currently standing at JPY 54,000-54,500/mt ($346-349/mt) FAS and shindachi scrap quotations are at JPY 53,000-53,500/mt ($340-343/mt) FAS.
Also, an offer for ex-US HMS I/II (80:20) has been heard at $395/mt CFR to Vietnam this week, “but with no bids from buyers,” a source said.
Some of the mills located in the southern regions of South Korea have increased their domestic scrap procurement prices by $8/mt temporarily. This means that after three days those mills’ procurement prices will go back to their original levels. However, a major mill in the same area decided to cut prices instead due to the planned maintenance works on all their EAFs starting from mid-May until the end of the month.
But an impressive threshold in South Korea in regards of domestic scrap purchases was reached in the first quarter of 2024, with the share of domestic scrap purchases reaching 90 percent in this period for the first time. “This explains all the things we experienced over the past months,” a source at a major producer said. “Domestic scrap was under pressure for a long time and South Korean scrap suppliers are not experienced in exporting. This is also putting them in a vulnerable place.”
$1 = JPY 155.88