Japan Ferrous Scrap Market Price Shows Rebound Sign

Japanese ferrous scrap market price is showing signs of rebound. Ferrous scrap export price to East Asia seems hitting bottom along upsurge of American ferrous scrap price. Tokyo Steel Manufacturing, Japanese largest electric furnace steel maker, raised purchase price of ferrous scrap for the first time in about 2 months. Japanese major electric furnaces other than Tokyo Steel are in wait-and-see stances, not following the price hike by Tokyo Steel. However, one dealer source said market mood is likely to strengthen before twice three-day weekend in September.

Japanese ferrous scrap export price to East Asia is currently FOB 33,900 yen per tonne for H2 grade. The price is higher by 400 yen than the current bottom, export price to Hyundai Steel in late August. One dealer source said Japanese ferrous scrap price is lower than American ferrous scrap despite of high yen rate.

American export offer price increased to around CFR US$ 500 per tonne for HMS grade or no.1 grade to South Korea. One large dealer source said Japanese offer price is around CFR US$ 465 for H2 and the margin gap is estimated at US$ 25 compared with American ferrous scrap price.

Another dealer source said domestic demand for steel products maintain inactive but domestic electric furnaces are forced to launch price hike when scrap dealers might reduce shipment to steel makers due to low price.