Japanese Ferrous Scrap Market Price Moves Up Slightly

Ferrous scrap market price continued to increase slightly in Japan. Scrap shipment from East Japan to West Japan continued while newly contracted scrap export price to South Korea increased. Meanwhile, demand for steel products maintains slow. One trader points out ferrous scrap market price seems not to surge largely and export to East Asia is not so strong to raise domestic scrap market price.

Electric furnace steel makers around Tokyo purchased H2 grade at 34,500-35,500 yen per tonne and some paid as high as 36,000-37,000 yen as of Wednesday. Tokyo Steel Manufacturing and other electric furnaces raised the purchasing price by 500 yen on Wednesday.

Local scrap generation maintains very low. Scrap supply is especially tight for high grade scrap such as new cutting scrap. H2 inventory is also decreasing at dealers’ sites. Meanwhile, demand for steel products seems to be stagnant and electric furnaces enter seasonal output reductions in summer. Scrap market price is unlikely to continue surging.

Around Osaka, local electric furnaces purchased H2 at around 36,500-37,500 yen on Wednesday. In Himeji area, Yamato Steel, JFE Bars & Shapes, and Godo Steel raised the purchasing price by 500 yen to follow Tokyo Steel’s price hike on Wednesday. The price trend is unforeseeable when regional crude steel production is estimated to decrease by around 10% in July from June.