TOKYO Japanese ferrous
scrap prices appear to be taking a breather after their recent
climb as mini-mills complete their restocking.
The national average price for
H2 scrap (a mix of No. 1 and No. 2 heavy melt) stood at 23,926
yen ($291) per tonne at the end of last week, up 6 percent from
the previous week.
"Scrap (purchase prices) have
gone up by quite a lot in recent weeks. This was partly because
scrap prices had been seen as having reached unsustainably low
levels, but more recently due to heavy buying ahead of last
weeks public holiday," one market participant told
AMM sister publication Steel First. He added,
however, that he expects prices to remain stable for a short
period as the market reassesses conditions before a possible
Tokyo Steel Manufacturing Co.
Ltd., Japans largest electric-arc furnace (EF) operator,
has left its purchase prices unchanged since Nov. 20 (
amm.com, Nov. 21).
Japans EF operators tend
to ramp up output at weekends and on public holidays to take
advantage of lower electricity rates.
The countrys mini-mills
already face some of the highest power rates in the world.
Nearly all of the countrys nuclear power plants were shut
down in the wake of the earthquake and tsunami in March last
year, and now mills face the prospect of still-higher
electricity charges going forward as utilities fight to offset
higher generating costs.
The head of the Japan Iron and
Steel Federation warned last week that the domestic steel
industry faces as much as 100 billion yen ($1.22 billion) in
added costs if the power tariff increases being considered by
five of the countrys utilities are pushed through.
The recent rally in scrap prices also has been fueled by a
sharp rise in export prices, which early last week rose to
about 27,000 yen ($328) per tonne f.o.b. on deals to South
A version of this article was first
published by AMM sister publication Steel