Japan Ferrous Scrap Drops around Tokyo and Osaka

Japanese ferrous scrap price decreased when Tokyo Steel Manufacturing, Japanese biggest electric furnace maker reduced the purchase price of it on Thursday and other electric furnace makers decreased the price around Tokyo and Osaka, too, though South Korean steel makers re-started the purchasing of Japanese ferrous scrap.

Large dealer source said each maker must get the profit by the preservation of price deference between their steel products and ferrous scrap, and they are cutting the output by a large margin. Steel products market price is seemed to drop due to decreased ferrous scrap price.

Electric furnace steel makers reduced the ferrous scrap purchase price to 15,000-16,000 yen per tonne by 500 yen on Thursday around Tokyo and some pay as high as 17,000 yen. Their purchase prices decreased by 2,000-2,500 yen per tonne after the beginning of this month. Their order volume for ferrous scrap is decreasing due to Japanese steel makers’ output cut. Utsunomiya works of Tokyo Steel Manufacturing reduced the purchase price to 17,000 yen per tonne by 500 yen for H2 grade on Thursday.

Ferrous scrap export price from Tokyo bay is same against local makers’ purchase price. Chinese steel makers are buying Japanese ferrous scrap. However, Japanese large dealer source said Chinese buying is unlikely to have a significant impact on domestic ferrous scrap market price when domestic demand for ferrous scrap drops by makers’ output cut.

The makers reduced the purchase price to 14,500-15,500 yen per tonne by 500 yen for H2 grade around Osaka. Large dealer source said ferrous scrap market is nearly closed state and dealers’ sale destination is likely to significantly decrease at the ended of this year and the beginning of next year.