Japan Ferrous Scrap Supply and Demand Gradually Tightens

Supply and demand balance of ferrous scrap is gradually tightening in Japan. Scrap trading is restarting around Tokyo after confusion of Japan Earthquake. Scrap demand is increasing in West Japan. Meanwhile, around Nagoya, ferrous scrap generation is decreasing from automotive component makers.

Around Tokyo, scrap delivery from scrap dealers to local electric furnace steel makers is recently activated. Cargo movement is almost recovering to the pre-earthquake level though scrap trading was stagnated by radiation problem and gasoline shortage. Marine shipment is also restarting to Nagoya and Osaka while new scrap export contracts are concluded with South Korean importers. Local scrap supply and demand is gradually balanced.

Around Nagoya, automotive component makers are in low operation when Japanese automakers are decreasing car production after Japan Earthquake. The component makers hold a certain amount of inventories. Thus ferrous scrap generation from auto component makers’ plants is largely decreasing.

Around Osaka, West Japan, local ferrous scrap supply maintains tight though marine transportation restarted from East Japan. Yamato Steel in Himeji, Hyogo Prefecture started production and supply of steel products for temporary housings on March 20th. Himeji works of JFE Bars & Shapes is alternately producing shape steels for Kashima works. A local scrap dealer suggested ferrous scrap demand around Osaka should increase by 20,000-30,000 tonnes from the previous month.