Japan Ferrous Scrap Price Rises

Japanese ferrous scrap market price increased for 2 weeks in a row. Electric furnace steel makers’ purchase price increased by 1,250 yen or 5% to 27,000-28,500 yen per tonne for H2 grade scrap when the export price exceeded FOB 30,000 yen under higher demand from South Korea and China. Japanese integrated steel makers’ higher demand also supports the market. The domestic price is expected to reach 30,000 yen under the tight supply.

Electric furnace steel makers pay 27,000-28,500 yen per tonne for H2 grade scrap, which is 1,500-2,000 yen higher than previous week. Tokyo Steel Manufacturing and other makers increased the purchase price by 1,500-2,000 yen on Friday.

Local steel makers try to secure scrap by the higher price when the export price moves to higher level for East Asia than local market. Local scrap supply has no major change but the higher export shipping impacts on the market under low level scrap generation.

Successful export bid hit more than 30,000 yen per tonne for H2, which was the first 30,000 yen since August 2009, at Kanto Tetsugen’s export tender last week. The higher export price is expected to lift domestic market price level.

Electric furnace steel makers around Osaka also increased the scrap purchase price by 1,000-2,000 yen per tonne from previous week to 26,000-27,500 yen for H2. Godo Steel increased the purchase price by 1,000 yen at Osaka plant and Osaka Steel increased the purchase price by 2,000 yen at Sakai and Okajima plants in Osaka. Yamato Steel increased the purchase price by 1,000 yen to 28,500 yen for H2 grade.