Japan Ferrous Scrap Price Continues to Surge for 6 Weeks

Japanese ferrous scrap market price increased for 6 consecutive weeks. Some electric furnace steel makers’ H2 purchase price exceeded 35,000 yen per tonne. Integrated steel makers are increasing scrap procurement from the market. A scrap dealer source said hot metal price is expected to rise in and after April due to the upsurge of raw material costs and ferrous scrap price may follow the trend. The new export negotiations are slowing down for ferrous scrap to East Asia while domestic scrap supply is tightening. Tokyo Steel Manufacturing, Japanese largest electric furnace steel maker, raised the purchase price by 1,500-2,500 yen per tonne on Tuesday.

New export negotiations are slow for East Asia since Chinese New Year holidays in mid February. On the other hand, Japanese integrated steel makers are increasing scrap procurement.

Electric furnaces around Tokyo pay 33,000-34,000 yen per tonne for H2 and some pay as high as 34,500 yen. The price surged by 1,000-1,500 yen from last week and by about 9,000 yen from the beginning of this year. Around Osaka, local electric furnaces pay 33,000-34,000 yen per tonne for H2 and some pay as high as 35,000 yen. The price upped by 1,250 yen from last week. Kishiwada Seiko raised the price by 1,000 yen on Tuesday. Yamato Steel and JFE Bards & Shapes also increased the purchase price by 2,500 yen.

US composite ferrous scrap price, the international market indicator, rose rapidly in the second week of March. US and Japanese exporters are expected to raise the export price to East Asia. A scrap dealer source said high quality ferrous scrap price is likely to reach 40,000 yen per tonne even in domestic market.