The East Asian import market for bulk heavy melting scrap and Japanese scrap rose over the past week on tight supply and strong demand.
Buying interest in South Korea and Vietnam was strong, and recent scrap deals in these two countries continued to set the prices in the region.
On Wednesday, a leading South Korean mill was heard by traders to have booked two US bulk scrap cargoes for May shipment at $235/mt CFR HMS I basis. It purchased the cargoes from two different suppliers, one was for 45,000 mt and the other for 40,000 mt.
Platts assessed East Asian bulk HMS I/II 80:20 scrap on Wednesday at $235-$240/mt CFR, up from the previous week's $225-$230/mt. The implied midpoint of $237.50/mt was $10 higher. This was the fourth successive price increase since March 2.
Previous bookings for bulk HMS 80:20 from Australia concluded at $225/mt CFR to Southeast Asia, including Thailand. Bulk scrap offers continued to be very limited and many traders in the region attributed this to bullish suppliers withdrawing offers in anticipation of increasing prices.
"Demand is very high in Vietnam," a trader there said. He believed that there could be buying interest at $240/mt CFR for bulk 80:20 if there were offers available in the market.
In Taiwan, containerized 80:20 scrap for May shipments bookings took place late last week at $210/mt CFR. New offers are prevailing at $215/mt CFR, but no orders were heard by Taiwanese sources.
Japanese scrap prices to export markets in the region also rose over the past week on active buying in South Korea.
On Wednesday, Platts assessed its weekly H2 scrap price at Yen 22,000/mt ($196/mt) FOB for FOB Tokyo Bay, up from last week's assessment of Yen 20,500-21,000/mt FOB. It is up Yen 1,250/mt from the mid-point of Yen 20,750/m.
South Korea's Hyundai Steel was heard to have bid H2 scrap at Yen 22,000/mt FOB and Shindachi scrap at Yen 24,500/mt FOB on Wednesday. The South Korean mill had received offers for H2 scrap from Japanese suppliers at Yen 22,000-22,500/mt FOB on Tuesday.
"Hyundai's bid was higher than expected," a Tokyo trader said. He expected other South Korean mills to accept a buying price of Yen 22,000/mt FOB from now on.
Last week, the South Korean mill booked H2 scrap at Yen 20,800/mt FOB.
Other South Korean mills including Dongkuk Steel Mill were able to secure limited volumes of Japanese H2 scrap at Yen 21,000/mt FOB the day after.
In Vietnam, demand for scrap is strong as local electric-arc mills boost their melting capacities amid the imposition of provisional safeguard duties of 23.3% on imports of billets and 14.2% on long rolled product. Deals have taken place at $220-225/mt CFR for H2 scrap, a Hanoi-based trader said.
A trader in Ho Chi Minh City said that the lowest price offer for H2 scrap he heard in the market was $225/mt CFR and that he heard a H2 deal concluded early last week at $221/mt CFR Haiphong.
Domestic scrap prices in Japan also rose this week. Tokyo Steel Manufacturing, Japan's leading mini-mill lifted its scrap buying prices twice this week, effective March 26 and March 30 arrivals.
The company's H2 buying price at its Utsunomiya works, north of Tokyo, would be lifted to Yen 19,000/mt, a total increase of Yen 1,500/mt for this week. Japanese traders are currently paying Yen 19,000-19,500/mt FAS at Tokyo Bay area to collect H2 scrap, up Yen 500-1,000/mt from last week.
