Lower Ferrous Scrap Price in Tokyo

Ferrous scrap purchase price by electric furnace steel makers around Tokyo decreased by 2,000 yen to 62,000-66,000 yen per tonne for H2 grade in the week. The price dropped due to lower consumption by local steel makers during seasonal output reduction period and slower export shipping from Tokyo bay. Local electric furnace steel makers reduce the consumption due to seasonal output reduction with regular maintenance during summer time peak electricity cost. South Korean buyers are reluctant to purchase high priced Japanese scrap when they can purchase scrap from USA and Russia. Local scrap dealers around Tokyo ship mainly for local steel makers while some of the steel makers stopped the scrap acceptance temporally. Tokyo Steel Manufacturing’s Utsunomiya plant reduced the scrap purchase price by 2,000 yen to 66,000 yen per tonne for H2 grade on Tuesday under local oversupply. Other local steel makers followed the move to reduce the purchase price by around 2,000 yen. The local steel makers’ purchase price decreased by around 6,000 yen per tonne since recent peak. The makers could reduce the price more when the local supply could keep the oversupply balance. Ferrous scrap market price also decreased by around 2,000 yen per tonne around Osaka in the week due to higher supply for local makers. The makers reduce the purchase price one after another around Osaka and Himeji, Hyogo when they secured inventory enough to the operation during summer time vacation period. Local electric furnace steel makers around Osaka pay 67,000-68,000 yen per tonne for H2 grade, which decreased by around 5,250 yen from recent peak. Local makers reduced the price by 2,000 yen on Tuesday. Yamato Steel, JFE Bars & Shapes’ Himeji plant and Godo Steel’s Himeji plant reduced the price by 2,000 yen on Tuesday. Yamato Steel’s purchase price decreased to 65,000 yen per tonne for H2, which was 6,000 yen lower than recent peak. Many of steel makers around Osaka limit the scrap acceptance due to higher arrivals from the market. Tokyo Steel also stops the acceptance from 16 pm of Monday to 7 am of Thursday. With the lower demand, local scrap supply is oversupply when the dealers built the inventory. The price could keep weak due to oversupply.