Domestic ferrous scrap prices in a few Asian markets moved up this week due to lowered generation and resulting supply crunch. Taiwanese domestic scrap prices increased and Feng Hsin Steel raised its ferrous scrap purchase and rebar sales prices, both by NT$300/mt on Monday. South Korean steelmakers, however, continued to bid lower for domestic scrap. Many steelmakers in Southeast and East Asia have stopped procuring domestic scrap on weakened finished steel sales.
Taiwan
Taiwan’s domestic ferrous scrap prices rose this week as yards refused to sell ferrous scrap at lower prices on a supply crunch. Thus, domestic rebar prices also increased driven by a rise input cost despite no signs of finished steel demand picking up in the country.
The weekly Davis Index for domestic HMS 1&2 (80:20) in south Taiwan settled at NT$6,550/mt ($218/mt) del plant, up by NT$250/mt. The weekly index for HMS 1&2 (80:20) in north Taiwan settled at NT$6,750/mt del plant, up by NT$250/mt. In South Taiwan, Feng Hsin Steel raised both, domestic ferrous scrap and rebar purchase prices by NT$300/mt on Monday, April 20. The company’s bids for domestic HMS 1&2 (80:20) at NT$6,400/mt delivered Taichung plant. Feng Hsin’s base rebar offers increased to NT$13,700-13,800/mt ex-producer. While billet priced at NT$12,300/mt ex-plant in the domestic market.
In seaborne trades, US-origin containerised HMS 1&2 (80:20) traded in the range $218-220/mt cfr Taiwan, up by $5-7/mt from prices late last week.
Japan
The Japanese government has extended its emergency halting trades in the country. Still, yards refused to accept lower bids, citing a recovery in export prices. Japanese domestic scrap prices remained flat with Tokyo Steel kept prices unchanged after lowering by JPY500/mt on April 11 at two of its works, Tahara and Utsunomiya. Bids for #2 HMS remained unchanged delivered Utsunomiya in Kanto region and Tahara in the central region were at JPY18,500/mt and JPY19,500/mt, respectively.
Nippon steel corporation has decided to temporarily idle its blast furnace in Kimitsu, in eastern Japan in Mid-May to respond a sharp drop in the demand for steel products in both domestic and exports markets.
South Korea
South Korean steel mills continued to cut domestic scrap purchase prices to save overall costs amid weakened finished steel sales. Many steel mills also have scaled-down production. Consumption rates also dropped further this week.
Effective April 20, Korea Steel has lowered its higher-grade scrap purchase prices by KRW10,000/mt from the prior week.
The weekly Davis Index for domestic Heavy A settled Tuesday at KRW245,000/mt ($204/mt) del Incheon, down by KRW2500/mt. The Davis Index for Heavy A settled at KRW230,000/mt del Pohang, also down by KRW2,500/mt from the prior Tuesday. The weekly Davis Index for domestic Light A settled at KRW215,000/mt delivered Pohang plant, down by KRW2,500/mt.
South Korean Steel Resources Association has urged steelmakers like Posco to refrain from booking imported ferrous scrap and opt for domestic grades. The South Korean domestic ferrous scrap industry is struggling for existence as major steelmakers prefer to procure ferrous scrap from Japan, the US and Russia over domestic scrap.
Vietnam
The weekly Davis Index for HMS 1&2 (80:20) settled at VND5,500,000/mt ($235/mt) delivered South Vietnam, inclusive of taxes, up by VND200,000/mt from prior Tuesday. Amid the Vietnamese government’s social distancing measures, manufacturing and generation rates have sharply dropped.
China
The weekly Davis Index for domestic HMS 1&2 (80:20) settled Tuesday at CNY2,300/mt ($325/mt) inclusive of 13pc vat delivered to mill in eastern China, down by CNY50/mt from the prior week.Prices had dropped by CNY130-150/mt in the prior week.
Since Monday, domestic scrap prices edged up amid short supply and rising finish steel prices this week. Shagang Steel headquartered in Zhangjiagang, east China’s Jiangsu province, increased prices by CNY80/mt on Monday to CNY2,280/mt del Jiangsu plant, inclusive of the 13pc VAT for #2 HMS (6-10mm thickness), as per a Davis Index source.
Thailand
Thailand’s domestic scrap prices rose due to a fall in generation rate as manufacturing and demolition activities remain halted. The weekly Davis Index for domestic HMS 1&2 (80:20) settled at THB7300/mt ($225/mt) delivered Rayong, inclusive of taxes, up by THB50/mt from the prior week. No steelmaker was ready to bid for imported scrap as the country remains under lockdown to fight COVID-19.
Malaysia
Malaysian domestic ferrous scrap suppliers raised their offers following global cues. The Malaysian government has extended is COVID-19 related lockdown by two weeks, till April 28. No major trades were reported. The weekly Davis Index for domestic HMS 1&2 (80:20), delivered western mills, settled at MYR855/mt ($195/mt), up by MYR15/mt; and the index for HMS 1&2 (80:20) delivered eastern mills settled at MYR915/mt, inclusive of taxes, unchanged from the prior week.
($1= JPY107.4; TWD30.08; CNY7.07; THB32.5; MYR4.39; VND23,442.5; KRW1,233.3)