Kanto Tetsugen Aims Ferrous Scrap Sales at 200,000T for Aug-Jul

Mr. Atsushi Watanabe, chairperson of Kanto Tetsugen which is an association consisted of ferrous scrap dealers around Tokyo, explained the association’s yearly ferrous scrap sales totaled 203,709 tonnes for August 2009-July 2010 and the total sales value was 6.115 billion yen. The sales volume was almost as flat as the previous year while the sales value increased by 15.5%. The successful bid price was averagely 29,950 yen per tonne. He regarded the association could serve as a balancer to export surplus ferrous scrap through its export tenders when domestic scrap demand maintained weak.

Mr. Watanabe said the association targets the annual sales value at 6.02 billion yen and the sales volume at 200,000 tonnes for August 2010-July 2011 at least. He suggested the ideal successful bid volume is 20,000 tonnes per month at Kanto Tetsugen’s export tender. He explained domestic scrap demand was weak for April-September 2010 and scrap shipment volume was pulled up by export mainly for East Asia.

Mr. Watanabe gave an outlook that scrap market tone would be weak for October-March. Japanese integrated steel makers are decreasing scrap purchase from the market while offshore demand for Japanese ferrous scrap is slowing from China though stable orders from South Korea.

He pointed out domestic scrap dealers should avoid too high scrap procurement to sustain their profitability even under weak market trend. He said some domestic scrap dealers recently purchase ferrous scrap at the price almost as high as steel makers’ purchasing price when scrap generation keeps very low while scrap dealers increase their processing capacities. He said domestic scrap dealers should eye internationalization of ferrous scrap market rather than excessive domestic competition.