Japan Steel Scrap Composite Price Hits First Drop in 5 Weeks

Japan Steel Scrap Composite Price decreased for the first time in 5 weeks. The price in first week of September is 21,300 yen per tonne for H2 and 25,000 yen for new cutting scrap, both of which is 1,000 yen lower than previous week. Local steel makers reduce the scrap purchase price when the export price is peaking.

The price represents US$ 224.75 per tonne for H2 and US$ 263.80 for new cutting scrap.

Scrap market price decreased by around 1,000 yen per tonne around Tokyo compared with the recent peak in third week of August. The demand is expected to increase in September when many makers finish summer time maintenance outage. However, the supply is low level and the limited supply could keep the local tight supply. The dealers expect the scrap market couldn’t decrease continuously under the supply balance.

Scrap market price decreased by 1,000-1,500 yen per tonne both for makers’ purchase price and FAS shipping price around Nagoya from the recent peak. The demand increases when integrated and special steel makers raise the operation rate to serve higher automobile production. The dealers expect the market price could adjust the high price but keep relative high level under low level scrap generation and low level dealers’ scrap inventory after high level export shipping.

Scrap market price decreased by 500 yen per tonne around Osaka when local electric furnace steel makers reduced the purchase price. The industry interests are still expecting the price would keep relative high level when some electric furnace steel makers keep the high purchase price, their scrap inventory keeps low level and scrap supply is still low level.

The composite price is averaged price of the dealers’ purchase price in Tokyo, Osaka and Nagoya.