Global Ferrous Scrap Market Overview - Week 2, 2019

Prices continued downtrend in cargoes getting booked in Turkey, however, massive bulk vessel bookings by South Korean steel mills remained a focus of the week. Global scrap prices seem to have stabilized towards the closing of the week, participants expect prices bottoming out in the near term. Japan’s monthly Kanto scrap export tender fetched bids down marginally despite stronger expectation from suppliers. Asian markets observed improved trades at falling prices despite weak local sentiments. Bangladesh observed considerable buying amid positive domestic sentiments.

Turkish steel mills resumed scrap booking at lower prices - Steel mills in Turkey resumed scrap bookings on low stocks witnessing around seven bulk scrap cargo purchases this week comprising a total 220,000 MT. In a most recent deal reported yesterday, Iskenderun region based steelmaker booked 25,000 MT of HMS 1&2 (95:5) at USD 283/MT and 13,000 MT of Shredded at USD 285/MT at an average price of USD 283.5/MT, CFR Turkey.

SteelMint’s price assessment of HMS (80:20) for US origin scrap stands at around USD 280/MT, CFR against USD 285-286/MT, CFR reported last week. While assessment of HMS 1&2 (80:20) of European origin moved down at USD 273/MT, CFR.

Japan’s Kanto monthly scrap export tender fetches bid down USD 6.5 - Japan’s monthly ferrous scrap export tender for Jan’19 observed average bids down JPY 703/MT on a monthly basis. A total 20,000 MT H2 scrap auctioned through three winning bids presented at an average of JPY 28,775/MT (USD 266), FAS in Jan’19. Tokyo Steel lowered scrap prices by JPY 500/MT (USD 5) at all plants in the opening of the week. H2 scrap prices stand at JPY 31,000/MT (USD 286) for Utsunomiya plant and JPY 30,000/MT for Tahara works.

Hyundai Steel booked a bulk cargo for Japanese H2 at stable JPY 29,500/MT (USD 272), FoB Japan and few steelmakers contracted H2 at JPY 30,000/MT, FoB. Japan’s local scrap prices remain weak and less likely to see an upward correction in the near term.

South Korean steel mills book several bulk scrap cargoes - Hyundai Steel booked two bulk scrap cargoes each one from US and Russia at further declined prices this week. US origin cargo comprising 32,000 MT mixed scrap equivalent to HMS 1 at USD 311/MT sold for Mar’19 shipment while Russian A3 scrap cargo booked at USD 301/MT, CFR.

Dongkuk Steel booked 28,000 MT mixed scrap at an average price of USD 308/MT, CFR and Welcome Steel mill booked 30,000 MT US scrap at around USD 310/MT, CFR. Although domestic scrap prices continued uptrend amid rising volume of distribution, sentiments less likely to remain bullish on approaching Lunar holidays in Early Feb'19.

China’s domestic scrap prices remained stable - China’s largest scrap consumer, Shagang Steel held scrap purchase prices stable at RMB 2,570/MT (USD 380) inclusive of 16% VAT for HMS (6-10 mm thickness) in Zhangjiagang. According to reports, Shagang Steel also has rolled over finish steel prices for mid-Jan shipments.

Vietnamese scrap importers remained in search of bulk cargoes - Vietnamese scrap importers increased enquiries for bulk cargoes this week however remained in search of reasonable prices. Price assessment stands stable for HMS 1&2 (80:20) from US at around USD 316-317/MT, CFR. Japanese H2 assessed in the range USD 295-300/MT, CFR Vietnam.

Taiwanese scrap prices continued downtrend - Price assessment for USA origin HMS (80:20) stands at around USD 265-270/MT, CFR Taiwan in containers, down USD 5-10/MT against the last week’s report. Limited trades reported at USD 265/MT, CFR.

Indian imported scrap offers stable; limited trades at corrected prices - Indian imported scrap market observed limited trades at corrected prices on W-o-W basis, however, prices seem to have bottomed out and likely to remain steady in the near term. Domestic scrap prices exhibited a mixed trend on volatile domestic fundamentals.

SteelMint’s assessment for containerized Shredded stands in the range USD 315-320/MT, CFR Nhava Sheva. Offers from Europe and US stand mostly at around USD 320/MT and buying interest was seen at around USD 314-315/MT, CFR amid minor trades reported. Dubai HMS 1 and South African HMS assessed at USD 320/MT, CFR and USD 318/MT, CFR. Containerized trades of Dubai HMS were concluded at around USD 310-320/MT, CFR depending on quality.

Pakistan imported scrap prices down, local steel market stands table - Despite a negative local market sentiment, Pakistan observed considerable volumes booked for February delivery. Offers for containerized Shredded from Europe and US heard in the range USD 315-320/MT, CFR Qasim. Some direct yard Shredded trades heard from UK and US at around USD 312-314/MT, CFR Qasim. Dubai origin HMS 1 was being offered at around USD 318-320/MT, CFR Qasim. The domestic market has stabilized and the supply remained enough against local demand which could improve in upcoming days.

Bangladesh observed scrap bookings amid positive local sentiments - Bangladesh observed considerable quantity getting booked for imported scrap amid local scrap shortage. Both prices and movement for finish steel have improved this week. Shredded scrap in containers from US sold at USD 325/MT, CFR Chittagong. Shredded scrap was being offered in the range USD 328-330/MT from leading supplier yards from the US and Australia this week. HMS was being offered in the range USD 315-320/MT, CFR from Chile and Brazil.