Japan Ferrous Scrap Reaches 30,000 yen/t Level

Japanese ferrous scrap price increased by 1,000-2,000 yen per tonne for H2 scrap from previous week. The price exceeded 30,000 yen at purchase price by electric furnace steel makers for the first time since September 2009. Japanese steel makers are forced to increase the purchase price due to low level scrap generation and high level export shipping for East Asian countries.

Electric furnace steel makers pay 30,000-32,000 yen per tonne for H2 scrap around Tokyo. Tokyo Steel Manufacturing and other local makers increased the scrap price by 1,500-2,000 yen on Wednesday when the export FAS price increased to higher level.

Local scrap generation around Tokyo is still low level. The exporters are busy to ship from Tokyo bay for existing export order for East Asian countries. Local scrap dealers expect the scrap supply keeps tight for immediate future.

Electric furnace steel makers around Osaka pay 29,500-31,000 yen per tonne for H2 scrap. Makers around Himeji area increased the scrap price for the first time in a month. The price increase was 1,500 yen for Yamato Steel on Tuesday, 1,000 yen for Himeji plant of Godo Steel on Wednesday and 1,500 yen for Himeji plant of JFE Bars & Shapes on Wednesday.

Tokyo Steel’s scrap price increase on Wednesday impacts on local steel makers purchase while electric furnace steel makers around Osaka try to secure scrap through spot based purchase and purchase from other areas. A trading firm source warns with Tokyo Steel’s price increase, the scrap supply could decrease again while the supply improved around Osaka last week.