Japan Ferrous Scrap Export Price Hits Record at Kanto Tetsugen’s Tender

Japanese ferrous scrap market turned into bull tone. Scrap export price hit FAS 32,183 yen per tonne in average for H2 for February shipment at tender held by Kanto Tetsugen on Tuesday, which was record price since the establishment of the association 2001. The price jumped when export price to South Korea increases. The higher export price could impact on domestic market though some electric furnace steel makers around Tokyo reduced the purchase price slightly. The successful bid increased by 2,580 yen to averaged FAS 32,183 yen per tonne for H2 grade at the recent tender from previous month. The price was more than 2,500 yen higher than former record at 29,603 yen for December 2006 contract. The top bid was 32,320 yen per tonne followed by 32,250 yen of second bid, 32,130 yen of third bid and 32,030 yen of fourth bid. The four exporters will ship 5,000 tonnes each totaling 20,000 tonnes by March 15. Thirteen exporters out of 15 of eligible firms submitted 17 bids for the tender while 2 firms declined to join the tender. The seventeen bids were all more than 30,000 yen and the total bid was 90,000 tonnes, which was 6,000 tonnes lower than previous tender. Chairman Atsushi Watanabe of Kanto Tetsugen said the result was favorable though he didn’t expect such increase a month ago. He said the result was in line with the market condition. Local scrap supply around Tokyo shifts to electric furnace steel makers when export shipping is slow from Tokyo bay. The makers get scrap arrivals enough to the requirement and some reduced the purchase price. However, with the tender’s result, a dealer source said local steel makers couldn’t reduce the purchase price and they are likely to increase the price to the former level.