Slow Japan Brass Scrap Demand

Japanese brass scrap dealers hold overstock for brass turning scrap due to slower demand from brass bar makers. The demand decrease is much higher than lower scrap generation form processing plants.

Some of the dealers secured scrap by April preparing for potential tight supply of the scrap. However, the brass bar makers keep low level appetite for the scrap when their sales of the products are still slow. The oversupply pressures on the market price.

Japanese official copper ingot price decreased by total 120,000 yen to current 630,000 yen per tonne from beginning of April. The scrap dealers would post huge inventory valuation loss due to the lower price. The dealers could reduce the averaged stock price by purchasing lower priced scrap but the supply is limited when the sellers with inventory valuation loss are reluctant to sell at lower price.

Brass bar makers reduce scrap purchase volume in July around Osaka. Some of the makers started to reduce the purchase volume. The brass scrap market price is 20-30 yen per kilogram lower than the level around Tokyo. Even the wider price gap, the dealers around Tokyo are reluctant to purchase of the scrap from Osaka area.