Posted on 11 Jan 2021
Ferrous scrap prices remain strong in East Asia, Kallanish notes. Japanese domestic scrap prices shot up last month and the approaching Kanto Tetsugen scrap export tender is expected to generate demand for Japanese scrap in Vietnam.
The Japanese domestic scrap market enjoyed large price gains in December. Leading electric arc furnace operator Tokyo Steel revised its H2 scrap purchase prices 11 times last month. The company most recently announced that it will pay effective 26 December JPY 43,000/t ($414/t) for H2 scrap purchases trucked to its Utsunomiya steelworks, located north of Tokyo. This is JPY 14,000 ($135/t) higher than at the start of the month. Tokyo Steel was paying JPY 29,000/t for H2 scrap at the same steelworks effective 1 December.
Meanwhile, in Vietnam offers for Japanese H2 scrap are prevailing at $465-470/t cfr compared to $450-455/t cfr in mid-December. A deal for Japanese H2 grade scrap closed at $460/tonne cfr Phu My on Thursday 7 January. The shipment for the three cargoes, totaling 20,000t, are in February and March, with shipment by 15 March latest, market sources report. Japanese H2 was also heard booked slightly higher at $465/t cfr the week before.
Hong Kong HMS 1/2 50:50 grade scrap offers are prevailing at $469/t cfr. Bulk HMS 1&2 80:20 is currently offered at $490/t cfr, up from $470-480/t cfr in mid-December. A Vietnamese trader expects deep sea prices to rise during the week of 10 January, adding that he expects 80:20 "to start with a 5 soon."
Buying interest is thin, says another trader. But he expected interest to pick up during the same 10 January week especially after the Kanto Tetsugen Japanese scrap monthly export tender opens on Wednesday.
Source:Kallanish
