South Korea
Limited containerised bookings heard from South Korean mills following a rise in imported scrap prices to Taiwan and a shortage of containers at the USWC. Leading steelmakers bought bulk cargoes last week and are negotiating for more shipments amid tight domestic scrap supply. Traders opine mills could announce bids for Japanese scrap late this week, while few mills concluded deals at JPY41,500/mt ($378/mt) fob on Monday, offers rose to JPY43,000-44,000/mt fob.
South Korean importers are watching Turkish and Chinese mills’ purchase. With freights rising, most traders are expecting importers to raise bids further to compete with other Asian countries. Many traders believe the downside is over and scrap prices are expected to rise as Asian mills stock inventory before Ramadan.
Mills stayed away from containerised purchases and preferred negotiating for bulks, while many US-based exporters are worried about supplying containerised scrap on schedule due to a shortage of empty containers. Amid rising freight rates, suppliers hope scrap prices rise further.
The Davis Index for containerized HMS 1&2 (80:20), Wednesday, rose by $19/mt from the prior week to settle at $421/mt cfr South Korea with few deals heard. Bids rose by $10-20/mt to $415-420/mt cfr South Korea, with offers rising further to $425/mt. Traders indicated that offers for Taiwan and South Korea were similar due to supply constraints and higher freight rates.
The Davis Indexes for P&S 5ft and #1 HMS, Wednesday, rose by $26/mt and $15/mt from prior Wednesday to $455/mt and $426/mt cfr South Korea, respectively. The index for shredded rose by $25/mt to $440/mt from the prior week.
Domestic scrap prices in South Korea trended up with mills having limited inventory as bids rose KRW10,000-20,000/mt ($9-18/mt) effective Monday.
The weekly Davis Index for domestic Heavy A rose by KRW10,000/mt to KRW435,000/mt ($388/mt) and by KRW20,000/mt to KRW455,000/mt delivered Incheon and Pohang, respectively. Mills have raised new bookings due to low inventory, said traders.
Taiwan
Taiwanese mills raised bids amid bullish global cues and rising freight rates. The Davis Index for containerized US-origin HMS 1&2 (80:20) rose by $10/mt at $423/mt cfr Taiwan on Wednesday with bids rising to $415-420/mt cfr. US-based exporters raised offers to $425/mt but buyers resisted these prices as they found them unviable. The index rose $20/mt from the prior week (March 31).
Mills are cautious and are tracking Japanese export and Korean bids for Japanese scrap to gauge price direction. Mills are also tracking Chinese and Turkish purchases after the Davis Index for HMS 1&2 (80:20) rose $1.5/mt to $423/mt cfr Turkey on Wednesday from the prior day.
($1=KRW1,118; JPY109.8)