Osaka Steel’s Price Hike May Pull Up Japanese Fe Scrap Market

Osaka Steel, Osaka based major electric furnace steel maker, raises its purchasing price of ferrous scrap by 2,000 yen per tonne except for L2 grade at Sakai plant and plant with headquarters effective for June 22 arrival. Osaka Steel raises the purchase price for the first time since April 29 while Tokyo Steel Manufacturing, Japanese largest electric furnace steel maker, keeps its purchasing price unchanged since June 10. Osaka Steel’s hike may affect local market price of ferrous scrap.

On Monday, ferrous scrap market price kept flat in Osaka at around 21,500 yen per tonne for H2 grade. Local electric furnace steels paid 29,000-30,000 yen for H2 grade. A trader source said the market tone is weak when scrap export to East Asia maintains inactive. Local electric furnaces are in wait-and-see mood other than Osaka Steel.

The market price also stayed flat in Tokyo at around 24,000 yen per tonne for H2 grade, 25,800 yen per tonne for H1 grade and 27,500 yen per tonne for HS grade. Local electric furnaces paid 29,000-30,000 yen for H2 grade while some paid as high as 30,500 yen. In Tokyo, there were some new export contracts with Chinese importers last week though Chinese users had been inactive to procure Japanese scrap recently. Meanwhile, one trader pointed out the newly contracted export price is still cheaper than local market price and, that is, the market price cannot rebound yet.