Japan Ferrous Scrap Price Jumps Back

Japanese ferrous scrap market price jumped back. Tokyo Steel Manufacturing, Japanese largest electric furnace steel maker, raised the purchase price at last weekend when ferrous scrap export price to East Asia surged. Other electric furnace steel makers around Tokyo and Osaka followed the hike. This is the first hike in 2 months. Their purchase price upped by 2,000 yen to 26,000-27,000 yen per tonne for H2 grade. A dealer source said domestic price would continue rising to reflect supply tightness caused by active export.

Newly contracted export price is FOB US$ 29,000 per tonne for H2 grade. Orders are increasing for Japanese ferrous scrap from steel makers in South Korea, China and Taiwan when Japanese ferrous scrap price is lower than US price.

Electric furnaces around Tokyo raised the purchase price by 1,500-2,000 yen to 26,000-27,000 yen per tonne at last weekend. Around Osaka, 2 local electric furnaces followed Tokyo Steel Manufacturing’s hike. Yamato Steel raised the price by 2,500 yen per tonne to 27,500 yen for H2 grade on Saturday. Himeji iron works of JFE Bards & Shapes raised the price by 2,000 yen. Some integrated steel makers also increased the purchase price around Osaka.

A dealer source said domestic scrap supply is expected to tighten in response to dealers’ cooperative scrap export. Dealers are agressively collecting ferrous scrap in bay areas. A trader source said Japanese steel makers should raise the purchase price despite of their continuous output reductions since scrap arrivals may become lower than their consumptions.