The highest bid in Wednesday's monthly auction for Japanese H2-grade ferrous scrap for export from Tokyo Bay by end-June decreased by Yen 2,380/mt, or $21/mt, from last month's winning bid to Yen 25,000/mt, or $219/mt, free alongside ship for 5,000 mt, the auction organizer said.
The second winning bid was at Yen 24,660/mt FAS for 10,000 mt and the third was at Yen 24,620/mt FAS for 5,000 mt. The identities of the successful bidders could not be confirmed, however.
The auction auction held by the Kanto Tetsugen group of scrap dealers around Tokyo, attracted 17 bids for a total of 131,000 mt of scrap, with the average being Yen 23,586/mt FAS.
A Kanto Tetsugen official said the winning bids were higher than expected and that the average of all the bids combined was also higher than the average that traders are now paying to accumulate scrap for export.
Japanese traders are currently paying Yen 22,000/mt FAS to collect H2 material for export from eastern Japan, trading sources confirmed. This is lower by Yen 4,500-5,000/mt from a month ago, though unchanged from last week.
A Tokyo-based scrap trader said some of the placed parcels from Wednesday's auction might be used to fill orders held by the winners which they had contracted in previous months when prices were higher. "But this result will also lend support to Japanese scrap prices and prevent them from falling further," he said.
"After all, the highest bid is equivalent to around Yen 26,000/mt FOB, which is higher than the prevailing export price of H2," he added.
The latest booking for Japanese H2 material for export was placed by a South Korean steelmaker at the beginning of May for Yen 24,500/mt FOB, as reported.
S&P Global Platts assessed the H2 ferrous scrap export price at Yen 24,500/mt, or $216/mt, FOB Tokyo Bay on May 9, unchanged from the previous week's assessment.
