Japan Ferrous Scrap Price Drops Slightly

Japanese ferrous scrap market price turned in to adjustment due to peaking export price. Electric furnace steel makers reduced the scrap purchase price around Tokyo for the first time in 5 and half months while the makers’ purchase price peaks around Osaka. However, scrap traders expect the price could keep relative high level under tight supply when scrap export shipping continues in and after September and domestic steel makers increase the production level.

Electric furnace steel makers’ scrap purchase price is 30,000-31,500 yen per tonne for H2 grade around Tokyo, which is 500 yen lower than last week level. Scrap export price from Tokyo bay started to decrease since last week. Tokyo Steel Manufacturing’s Utsunomiya plant and other makers reduced the purchase price slightly.

Scrap export price is around FOB 31,500 yen per tonne for H2 to East Asia. A dealer source said offshore buyers are reluctant to buy relative higher priced Japanese scrap but the buyers are still interested in Japanese scrap as the major source.

Domestic scrap demand is low level when some electric furnace steel makers are still in summer time maintenance outage. However, the scrap supply is still low level while exporters would keep shipping scrap for existing orders. The industry interests expect the tight supply would support the market price.