Japan: Tokyo Steel Cuts Scrap Purchase Price 7th Time in June
As per new price circular released, Japan’s leading EAF mini-mill - Tokyo Steel has further lowered its domestic H2 scrap purchase price by JPY 500/MT (USD 5) today. Amid extremely weakened sentiments in the domestic market, Japanese scrap prices have been in free-fall mode since last few weeks, with this being the 2nd price cut by the company in 3 days
After the said price lowering, the company will pay JPY 26,500/MT (USD 246) for H2 scrap delivered at Tahara plant in central Japan as well as Utsunomiya plant in the Kanto region while JPY 24,500/MT (USD 227) for Takamatsu steel centre. For H2 delivered to Kyushu works in the western region and Okayama Plant, the new price is JPY 26,000/MT (USD 241).
As the company had lowered its finished steel prices earlier this month after a 5 month gap, it was expected that its purchase bids for scrap would fall sharply. Even with this being the 7th price cut by Tokyo Steel in the month June’19, current sentiments indicate that the prices are yet to bottom out, while it is likely that the overseas importers based in South Korea and Vietnam may also continue lowering their bids for Japanese scrap purchase in the coming days.
Several other EAF steelamkers in Kanto region and Gulf region too have made price cuts by JPY 500/MT as scrap purchase price in both the regions has reached lowest levels since June 2017. It is reported that the production by Electric furnace steelmakers has been weak, added to which the factors like lowered overseas demand of scrap and no tight supply-demand gap situation are expected to keep scrap sentiments weak.
Imported bulk scrap prices in East Asia continue downtrend - Japan’s H2 scrap is being offered at around USD 290/MT, CFR Vietnam while bulk HMS 1&2 from US is being assessed at around USD 300-302/MT, CFR Vietnam and USD 295-300/MT, CFR South Korea.
source: SteelMint
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