Ferrous Scrap Export Price Levels Off in Osaka

Ferrous scrap export price became FAS 31,000 yen per tonne for H2 from Osaka Bay at an export tender held by Osaka based ferrous scrap dealers’ group, Kansai Tetsugen on Friday. The price increased by 8,090 yen from the previous tender on June 3. The contracted volume was 5,000 tonnes. The price was lower by 940 yen than that of the export tender held by Kanto Tetsugen on August 11.

A large dealer source said ferrous scrap market price is expected to settle down because Japanese ferrous scrap price hit the peak when Chinese and South Korean importers are rejecting Japanese scrap due to the higher price than US scrap.

Tokyo based scrap dealer, Arae Shokai won the tender from August 24 to September 19. The averaged bid was 28,685 yen per tonne. 13 traders out of 17 eligible firms submitted 13 bids and 2 of the bids were more than 30,000 yen.

Chinese and South Korean importers had pulled up the market price and Japanese export volume. But the market price was likely to hit the peak when Hyundai Steel, South Korean largest electric furnace steel maker, reduced the offer price of ferrous scrap at the purchase tender in last week.

Ferrous scrap market price rose rapidly in August and exceeded 30,000 yen for the first time in 10 months. Scrap generation is less than steel makers’ output recovery. A dealer source said the successful bid price isn’t cheaper than domestic market price due to tight scrap supply. However, domestic ferrous scrap market price is expected to enter wait-and-see situation after the export price hit the ceiling.