SHANGHAI U.S. scrap prices to China have fallen below $400 per tonne c.f.r. after supply exceeded market expectations.
Offers for an 80/20 mix of U.S. No. 1 and No. 2 heavy melt scrap stood at about $395 per tonne c.f.r. Nov. 21, down $5 per tonne from a week earlier, while those for shredded scrap fell by the same amount to about $405 per tonne c.f.r., a steel mill source in Jiangsu province told AMM sister publication Steel First.
"Prices of U.S. HMS 1&2 (80:20) were at $402 per tonne c.f.r. ... Now that offer prices have dropped, we also lowered our bid to around $390 c.f.r. for the same material," a source at the scrap department of Zhangjiagang, China-based Jiangsu Shagang Group Co. Ltd. said.
Suppliers had held on to their cargoes recently following reports of tight supply, expecting prices to rise further, the source said, noting that prices have instead started falling.
"We already have many Japanese scrap cargoes at the ports and are not in a hurry to make more bookings," she added.
Offers of Japanese heavy scrap have also dropped to $395 per tonne c.f.r. recently from above $400 per tonne c.f.r., another Shagang source said.
Chinas domestic heavy scrap prices remained relatively stable Nov. 21 at 2,750 to 2,930 yuan ($438 to $466) per tonne, down from 2,850 to 2,930 yuan per tonne a week earlier.
"Some smaller mills have lowered scrap purchase prices for domestic scrap, but Shagang kept its prices stable to ensure a daily delivery of 5,000 to 6,000 tonnes of scrap," she said.
The steelmaker also said Wednesday that it was keeping its rebar prices unchanged for late November.
A version of this article was first published by AMM sister publication Steel First.