Global Ferrous Scrap Market Overview - Week 10, 2019

Turkish steel mills paid further high prices initiating April shipments as US domestic scrap prices settled at higher levels. Japan’s domestic scrap prices continued uptrend witnessing two price hikes by Tokyo Steel mill. South Korean domestic scrap prices increased in the Yeongnam region. East Asian markets witnessed restocking from spot purchases while South Asian markets observed limited trades on the disparity in buyers’ expectation and offers.

Turkey imported scrap prices move up USD 7-8/MT W-o-W - According to SteelMint’s price assessment, US origin HMS (80:20) scrap moved up to USD 322/MT, CFR Turkey. While HMS 1&2 (80:20) of Europe origin stands at around USD 315-316/MT, CFR. Turkey's steel mills continued deep sea cargo bookings for April delivery to replenish low stock. Now suppliers’ eye levels for HMS 1&2 above USD 325/MT, CFR Turkey.

In most recent deal confirmed, a steelmaker booked 32,000 MT of HMS 1&2 (80:20) at USD 322/MT, 5,000 MT of Shredded at USD 327/MT and 3,000 MT Bonus at USD 332/MT, CFR Turkey. Earlier a 40,000 MT HMS (80:20) spot shipment of European origin was booked at USD 315-316/MT, CFR. Turkish rebar prices in domestic and export markets remained rangebound amid subdued demand.

Japan's Tokyo Steel hiked scrap purchase price twice this week - Tokyo Steel hiked domestic scrap price by JPY 500-1000/MT (USD 5-9) in two price hikes made this week in Japan. The steelmaker is paying JPY 35,000/MT (USD 313) for H2 scrap delivered to Utsunomiya plant situated in the Kanto region and Kyushu plant. H2 price stands at JPY 34,500/MT at the largest plant Tahara and JPY 32,500/MT at Okayama works.

H2 selling price stands in the range JPY 34,000-34,500/MT, (USD 306-310), FoB Tokyo. While market awaits for Kanto Tender scheduled on 12th Mar’19 to have more clarity.

China’s Shagang Steel cut scrap price by USD 4/MT - China’s largest private scrap consumer, Shagang Steel lowered scrap purchase price by RMB 30/MT to RMB 2,620/MT (USD 390) inclusive of 16% VAT for HMS (6-10 mm thickness) in Zhangjiagang amid high supply and low steel margins. According to sources, the profit margin of EAF steelmakers between rebar and scrap remained very low, thus scrap prices are likely to remain range bound. Also, resumption of operation by EAF steelmakers likely to put pressure on finish steel prices in the near terms.

Vietnam scrap prices to recover following improving buying interest - Offers for bulk HMS (80:20) from US and Australia assessed at around USD 340-345/MT, CFR Vietnam, up USD 5/MT against last week. Following rising domestic prices in Japan, Vietnamese steel mills have to increase H2 bids amid tight supply-demand.

India observes limited trades, prices recover by USD 5-8/MT W-o-W - Indian imported scrap market observed less trades this week amid disparity between bids and offers. Prices rebounded by USD 5-8/MT W-o-W following strengthening global prices after last week’s fall. It is anticipated that prices may remain high in the near term on strong global demand. Domestic scrap prices showed a mixed trend on demand concerns in Semi-Finish market and HMS 1&2 assessed at INR 25,200-25,400/MT, (USD 360-363) ex- Mumbai.

SteelMint’s assessment for containerized Shredded stands at around USD 335/MT, CFR Nhava Sheva. Shredded in bulk cargo is being offered at around USD 345/MT, CFR. HMS 1 from Dubai and South Africa assessed at around USD 325/MT, CFR amid buyers expectation at USD 320/MT, CFR while West African HMS assessed around USD 310-315/MT, CFR Goa and Chennai. UK origin Sheared HMS 1&2 reported at USD 305/MT, CFR Nhava Sheva.

Pakistan’s scrap purchase sluggish amid less supportive local sentiments - SteelMint’s price assessment for Shredded edged up by USD 5-8/MT W-o-W in the range USD 332-335/MT, CFR Qasim. Asking rates for Shredded form UK and US reported above USD 335/MT, CFR. Offers for HMS 1 from UAE reported at USD 330-332/MT, CFR but buyers at around USD 325-327/MT, CFR. HMS 1 from UK was sold at around USD 315/MT, CFR Qasim. Local steel market has seen no significant change in demand with subdued activities. Prices for Bala billet remained flat at around PKR 74,000-74,500/MT (USD 529-532).

Pakistan’s Government is expected to increase electricity power tariffs from the existing average of PKR 12.98 per unit to PKR 16.24 per unit during next four months with the objective of bringing power-sector losses to zero from 1st of July’19 onwards. It may come in action next week, however, there is uncertainty regarding its impact at the moment. With this, public sector development projects execution turns skeptical and local steel prices could increase which may bound local demand further.

Bangladesh scrap buyers observe less trades amid high inventories - SteelMint's price assessment for Shredded scrap moved up by USD 5-10/MT W-o-W to USD 350-355/MT, CFR Chittagong. Containerized HMS 1 from Chile, Brazil and South Africa traded at around USD 335-340/MT, CFR. Local HMS prices moved up following rising global prices to BDT 36,000/MT, ex-works while shipyard scrap prices to BDT 37,700-38,000/MT (USD 450-453) this week. Local rebar offers moved down by BDT 1,000-1,500/MT W-o-W to BDT 58,000-58,500/MT (USD 690-696) on weak demand and many furnaces preferred Indian Sponge iron bookings amid cost competitiveness which was reported steady at around USD 330/MT, CNF Chittagong.