Japan’s monthly scrap export tender, Kanto Tetsugen concluded on Thursday with average bids down by JPY1999/mt ($191.2/mt) from the prior month. The tender sold a total of 20,200mt ferrous scrap, with the average winning bids at JPY20,656/mt ($190/mt) fas Tokyo Bay compared to JPY22,655/mt ($208/mt) fas Tokyo Bay in March.
The first winning bid was for 5200mt #2HMS by Sangyo Shinko at JPY20,800/mt ($219/mt), down JPY2,170/mt, down from the first winning bid recorded at JPY22,970/mt in the prior month. The second winning bid for 15,000mt by Toyota Tsusho company at JPY20,606/mt fas Tokyo Bay. The spread between first and second winning bid was of JPY194/mt ($2/mt).
The average winning bids of JPY20,656/mt fas or JPY21,650/mt ($190/mt) fob Tokyo Bay were higher than the domestic prices in Kanto region, mainly due to supply crunch in the market. Scrap export prices, however, are less likely to rise in the near term.
Japan’s crude steel output is forecast to fall 25.9pc in the April-June quarter as COVID-19 weakened demand, according the Ministry of Economy, Trade and Industry (METI). A slowdown in the global economy and disruption in supply chains due to the outbreak are expected to reduce industry demand for steel, especially in automobiles. Steel output is likely to drop to an 11-year low.