Ferrous Scrap Export Increases by 2.3 Times from Osaka Bay

Ferrous scrap export volume from Osaka Bay expanded by 128% to 415,790 tonnes through 2009 compared with 2008, according to Osaka based ferrous scrap dealers’ group, Kansai Tetsugen. The demand for ferrous scrap increased largely in East Asia, China and South Korea, though domestic electric furnace steel makers reduced their outputs by a large margin due to low demand for building materials.

Heavy ferrous scrap export increased by about 7 times to 288,829 tonnes in 2009 from 2008, the first increase in 4 years. Other items decreased by 9% to 126,461 tonnes in 2009 from 2008, which represented minus for 2 years in a row. In 2009 heavy scrap export significantly exceeded other grade scrap export as an unusual case because domestic electric furnaces’ scrap consumption shrank.

Local electric furnaces’ scrap consumption exceeded 400,000 tonnes per month at the recent peak in early 2008 while declined to around 200,000 tonnes per month in 2009. On the other hand, the demand for ferrous scrap increased in China and South Korea. Ferrous scrap export price stayed higher than domestic market price. As a result, local scrap dealers shifted their shipment to export from Osaka Bay.

South Korean and Chinese importers continue strong offers for Japanese ferrous scrap in 2010 due to cold weather in both countries. The offer price temporarily became higher by 3,000 yen per tonne than domestic market price. A large dealer source said Japanese ferrous scrap export may decrease in 2010 compared with 2009 because Japanese integrated steel makers are recovering scrap procurement volume.