Mills in South Korea, Taiwan and Vietnam raised bids for imported scrap post-holidays amid a short supply of domestic scrap and rising offers.
With Turkish bids for US-origin HMS 1&2 (80:20), Monday, rising by almost $10/mt from Friday to $434.84/mt cfr, traders expect imported scrap prices to rise further. Offers rose by $15-20/mt from Friday for India, Pakistan and Bangladesh with yards refusing to accept lower bids.
Japan
Tokyo Steel raised domestic scrap bids on Monday by JPY500/mt ($4.7/mt) for all works. The new purchase prices for #2 HMS were at JPY39,500/mt delivered Tahara, JPY39,500/mt delivered Okayama, JPY39,000/mt delivered Kyushu, JPY39,500/mt delivered Utsunomiya and JPY38,500/mt delivered Takamatsu, effective Feb 23.
With rising global scrap prices and domestic scrap shortage in Japan, traders expect prices to rise further in the coming days. Countries like South Korea, Vietnam and Taiwan are expected to raise bids for Japanese scrap this week while they cautiously track Turkish buying and Chinese demand.
South Korea
South Korean domestic scrap prices trended up this week. Suppliers refused to reduce offer prices to match bids, while some mills raised bids in anticipation of a further rise in imported scrap prices. In the import market, a South Korean mill is heard to have purchased bulk scrap from USWC for March delivery at $443/mt cfr late last week.
The Davis Index for domestic Heavy A rose by KRW10,000/mt ($9/mt) to KRW410,000/mt ($368.8/mt) and KRW395,000/mt delivered Incheon and Pohang, respectively. Few mills have raised bids for domestic scrap as yards refused to sell at lower prices on firm global ferrous scrap demand, said traders. Bids for Heavy A from Hyundai remained at KRW395,000/mt delivered Pohang from the prior week. Most mills are expected to refill inventories and offers are expected to rise on tight domestic supplies.
The weekly Davis Index for domestic Light A remained flat at KRW365,000/mt delivered Pohang mill with Hyundai bids remaining at KRW350,000-355,000/mt delivered Pohang.
Taiwan
The Davis Index for containerized US-origin HMS 1&2 (80:20), Tuesday, rose by $16/mt to $423/mt cfr Taiwan, from the prior day. Offers rose by $15-20/mt to $425-430/mt on Tuesday due to tight supply by exporters, while bids rose to $415-420/mt. Traders indicated that by the time Taiwanese importers raising bids, the offers moved up even further leading to no deals. Feng Hsin raising ferrous scrap prices by TWD500/mt late last week and TWD500/mt on Tuesday amid strong domestic scrap demand.
The weekly Davis Indexes for domestic HMS 1&2 (80:20) rose this week by TWD1,000/mt ($35/mt) to TWD10,750/mt ($385.8/mt) and TWD11,000/mt delivered South Taiwan and North Taiwan mills, respectively. Rising international scrap prices have prompted most mills to start negotiation for domestic and imported scrap post-maintenance work during holidays.
On Tuesday, limited offers for HMS 1&2 (70:30) from Central America in FEU heard at $400-405/mt cfr up from $385/mt cfr in the prior week. Taiwanese importers indicated that domestic scrap is still cheaper than imports but supply remains tight.
Vietnam
The weekly Davis Index for HMS 1&2 (80:20) rose by VND350,000/mt ($15/mt) this week to VND8,750,000/mt ($379.6/mt) delivered South Vietnam inclusive of taxes. With a rise in HRC price following recovery in the auto sector, traders expect bids to rise further in the coming days.
A few deals for busheling heard at VND9,500,000/mt delivered South Vietnam on Tuesday.
In bulk, offers for Japanese #2 HMS Tuesday rose by $10-15/mt to $430-435/mt cfr.
China
In China, Shagang Steel held ferrous scrap purchase prices amid strong domestic demand and high finished steel inventories.
Iron ore prices rose this week with offers rising to a 10-year high of $176/mt cfr Qingdao up by $10/mt from the prior week.
The weekly Davis Index for the HMS 1&2 (80:20) settled up by CNY50/mt at CNY3,250/mt ($503/mt) delivered mill, from the week prior. Steel prices are expected to rise further amid a positive demand outlook and successful vaccination drives, globally.
In Tangshan, Q235 150mm square billets rose by CNY400/mt at CNY4,250/mt($657/mt) due rise in domestic and global demand for finished steel. Many mills are expected to raise billet prices further due to low inventories and rising raw material cost.
China will speed up recycling and utilisation of renewable resources such as metals scrap to meet its carbon neutrality goal as per the State Council Monday, which is expected to raise demand further.
Japanese HS scrap offers rose to $470/mt, Tuesday, up by $10/mt from the prior week. No deals heard post holidays.
Thailand
The weekly Davis Index for domestic HMS 1&2 (80:20) settled flat at THB11,500/mt ($383/mt) delivered Rayong mill inclusive of taxes, amid limited deals. Price fell by $2/mt on account of currency depreciation. Mills are opting to wait and buy cautiously amid rising offers. Steel mills are expected to raise bids as they restock scrap inventory in anticipation of a rise in steel demand.
Deals for domestic P&S 5ft heard at THB12,400-12,800/mt on Tuesday, with mills preferring domestic scrap or imported billets due to rising raw material prices. Container shortage and vessel delays added to the woes of steel mills interested in short transit imports.
Billet trades rose by $20/mt to $580-585/mt cfr Southeast Asia, with offers rising to $590-595/mt cfr. Thai mills are expected to negotiate for billets at current prices in anticipation of a further rise next week.
Malaysia
The weekly indexes for HMS 1&2 (80:20) rose by MYR10/mt($2.5/mt) and MYR5/mt to MYR1,420/mt ($351/mt), and MYR1,450/mt delivered western mills and eastern mills inclusive of taxes, respectively.
Malaysian steelmakers are cautious amid an extension of lockdown in Malaysia and rising global scrap prices. Trades slowed with offers for US-origin HMS 1&2 (80:20) in FEU at $400/mt, up $10/mt from the prior week and limited bids at $370/mt. Traders expected MYR50-100/mt rise this week as global scrap prices remained firm. Importers are closely watching Turkish and Chinese scrap purchases ahead of new bookings.
($1=JPY105; TWD27.9; CNY6.4; THB30; MYR4; VND23,050; KRW1,111.7)