Posted on 21 Jan 2022
The East Asian market is seeing higher prices for scrap into South Korea and Vietnam, as well as billet into China, Kallanish notes.
South Korea’s leading electric arc furnace operator, Hyundai Steel, raised bid prices for Japanese scrap in its recent purchase auction. The steelmaker placed bids on 20 January for H2 grade scrap at JPY 51,000/tonne ($446/t) fob Japan, and JPY 58,000/t fob for shredded scrap, JPY 60,000/t for HS grade scrap, each of which is JPY 2,000/t higher than last week. The mill hiked its bid by JPY 1,000/t to JPY 58,000/t for Shindachi Bara (loose) scrap in the same auction.
Hyundai raised its bid prices because the domestic scrap market in South Korea is strong and will strengthen further after the Lunar New Year holiday in the country, a Seoul-based trader says. But he adds that Japanese suppliers may not be satisfied with Hyundai’s bid prices as they may be expecting up to JPY 54,000-55,000/t fob for H2 grade scrap. Japanese domestic scrap prices are much higher, and it is not possible for Korean mills to accept these levels, another says. Hyundai’s latest bid price is equivalent to around $479/t cfr Incheon.
Tokyo Steel is currently paying JPY 53,000/t for H2 grade trucked to its Utsunomiya steelworks, effective since 13 January.
Similarly, the scrap market is strengthening in Vietnam. Bulk 80:20 is now offered at $510-515/t cfr Vietnam compared to $505 last week, a regional supplier says. Containerised HMS 1/2 80:20 scrap from the USA has been booked this week at $455-460/t cfr compared to $450/t cfr last week, a trader says. Hong Kong scrap is currently offered at $495/t cfr and Japanese H2 scrap at $510-515/t cfr, an importer in southern Vietnam said on Thursday.
Meanwhile, China keeps paying higher prices for imported billet. A 30,000-tonne cargo of Indonesian 150mm 3sp blast furnace billet was ordered on 19 January at $640/t cfr China, Chinese trading sources report. The cargo is due for end-March shipment. Last week, billet from the same Indonesian mill sold at $635/t cfr China. "There is a billet shortage in the local market," a Shanghai trader says. Many EAFs have reduced output in China, he notes.
Source:Kallanish
