Mixed Japan Ferrous Scrap Price

Japanese ferrous scrap price decreased for 4 weeks in a row when the supply gets loose under low level operation rate by local electric furnace steel makers around Tokyo after the major earthquake. Japanese automakers’ production cut also impacts on steel makers’ operation. The lower automobile production reduces the scrap generation mainly for new cutting grade. Electric furnace steel makers around Nagoya and Osaka try to secure the high grade scrap by keeping the scrap purchase price. The price trend is mixed between decreasing heavy grade and firm high grade scrap.

Electric furnace steel makers pay 33,500-35,000 yen per tonne for H2 grade scrap around Tokyo, which is 2,000-2,500 yen lower than previous week. Tokyo Steel Manufacturing reduced the scrap purchase price by 500 yen at Okayama, Takamatsu and Utsunomiya plants on Thursday.

Other electric furnace steel makers around Tokyo followed the move to reduce the scrap purchase price. However, the export FAS price from Tokyo bay to match local steel makers’ purchase price when some dealers increased the scrap purchase price. The export market improves when South Koran makers restarted to purchase Japanese scrap in the week.

Electric furnace steel makers pay 35,500-38,000 yen per tonne for H2 grade scrap around Nagoya. The scrap shipment is low level for local special steel makers when local scrap supply for new cutting scrap including for foundry grade is expected to keep low level for immediate future. Local supply gets tighter mainly for high grade scrap.

Local scrap market shows sign to hit bottom even for heavy grade scrap around Nagoya when the export increases for South Korea. A dealer source said the market trend could be different directions between scrap from manufacturers and obsolete scrap.

Electric furnace steel makers around Osaka and Himeji reduce scrap purchase price along with Tokyo Steel’s price cut. The makers reduce the purchase price by 500-1,000 yen to 36,500-37,500 yen per tonne for H2 grade.

Local scrap price decreased in Osaka in March. However, the shipment is slow for local steel makers. A yard dealer said some electric furnace steel makers purchase some grades of scrap at spot basis. A trading firm source said some steel makers around Himeji plan to increase the output and the scrap supply could be tighter before major holiday in late April. The source said the supply balance depends on supply from eastern Japan.