Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Tokyo Steel has revised ferrous scrap prices for the third time in July. The steelmaker cut its domestic ferrous scrap purchase prices by JPY500/mt ($5/mt) at three of its sites, Okayama, Kyushu and Takamatsu steel center, effective July 8. This revision is the sixth successive price cut since June 25. Bids for ferrous scrap delivered to Utsunomiya and Tahara, however, remain unchanged.  


Purchase prices for #2 HMS are at JPY21,500/mt ($200/mt) delivered Utsunomiya works in Kanto region, indicating Japanese scrap prices might have reached a short term bottom. Bids for #2 HMS and busheling are at JPY23,500/mt and JPY25,000/mt delivered Kyushu and JPY23,000/mt and JPY24,000/mt delivered Okayama plant, respectively.  


Bids for busheling for deliveries to Tahara plant are at JPY25,500/mt, down by JPY1,000/mt and JPY23,500/mt del Utsunomiya plant, unchanged from July 4.  


A steep downward curve in demand for high-grade scrap pressured their prices more compared to medium-grade scrap in the domestic market as scrap hits oversupply situation. 


In the export market, prices of Japanese ferrous scrap continued to drop, driven by bids announced by Hyundai and Dongkuk Steel on Friday. Importers bids for #2 HMS bids at JPY21,500-22,000/mt fob Japan, down JPY500/mt from the prior week.  



Imported ferrous scrap prices in Taiwan fell further on Tuesday amid weak demand for finished steel from real estate and infra projects.

The daily Davis Index for containerised US-origin HMS 1&2 (80:20) settled at $226/mt cfr Taiwan on Friday, down by $4/mt. Bids for HMS 1&2 (80:20) were at $220/mt cfr with no trades heard on Tuesday. Offers for #1 HMS were at $240/mt cfr Taiwan and P&S 5ft was offered at $250/mt cfr but no trades heard at those levels.


Market participants are pushing bids $10/mt lower prices than the prior week banking on weak global cues to stock scrap inventories at lower rates. A drop in domestic scrap prices could also pressure importers to lower their offers to Taiwan in the coming days.


Steelmaker Feng Hsin lowered its bids for domestic scrap by NTD200/mt to NTD6,700/mt delivered plant on Monday. Bids for South American-origin HMS 1&2 (80:20) in FEUs were at $215/mt cfr Taiwan. 


In the small bulk markets, bids for Japanese HMS 1&2 (50:50) were at $235-240/mt cfr Taiwan and busheling scrap offers were at $260-265/mt cfr Taiwan, with limited trades.


($1=JPY107.7, NTD29.46)


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