TOKYO Japanese ferrous
scrap export prices continue to fall as South Korean mills, in
particular, move to cut their scrap purchasing prices both at
home and abroad.
The highest winning bid at the
latest auction by Tokyo-area scrap dealers for deliveries next
month of H2 grade scrap (a mix of No. 1 and No. 2 heavy melt)
fell 3.5 percent from last months auction to 33,670 yen
($338) per tonne f.a.s., or around 34,700 yen ($349) per tonne
Export prices last month hit
their highest level in well over a year after rising more than
50 percent over the course of just five months.
The latest prices also mark a
retreat from the export auction held by Osaka-area dealers late
last month, which saw the average winning bid come in at 34,000
yen ($342) per tonne f.a.s.
The drop in prices hasnt
come as a big surprise, given the sharp devaluation of the
Japanese currency in recent weeks and the fact that recent
export deals to Korea were settled at levels even lower than
those seen at the latest auction.
At the same time, domestic
market prices have been retreating ever since Tokyo Steel
Manufacturing Co. Ltd. began reducing its purchase prices at
the start of the month. The company is now paying 34,500 yen
($347) per tonne for deliveries to its Tahara Works, 33,500 yen
($337) per tonne for those to Utsunomiya Works, 33,000 yen
($332) per tonne for those to Okayama and Kyushu, and 32,000
yen ($322) per tonne for those to its Takamatsu facility.
A similar trend appears to be taking place in Korea, the
main export destination for Japanese scrap, where companies
such as Hyundai Steel Co. Ltd., Posco Specialty Steel Co. Ltd.
and Dongkuk Steel Mill Co. Ltd. reportedly were set to begin
cutting their domestic scrap buying prices April 11.
A version of this article was first published by AMM sister
publication Steel First.