The East Asian import market for bulk heavy melting and Japanese ferrous scrap has risen further on buoyant demand in Korea and Vietnam. Suppliers are also seeking higher prices on gains in other markets, including Turkey.
A full HMS 80:20 scrap cargo from Australia was heard ordered last week by a Thai flat steel producer at $245/mt CFR. "They are looking for some more scrap, they don't have enough" a Thai trader said Wednesday. The mill was also offered a full US cargo of shredded scrap at $255/mt CFR.
On Wednesday, traders reported hearing market talk that South Korea's Hyundai Steel made a booking for bulk scrap from the US at $253/mt CFR HMS I basis. But they also said it was just a rumor as this price was much higher that the mill's previous purchase price at $235/mt CFR HMS I last week.
A trader said it was a rumor as he did not think the South Korean mill would take this "wild" position.
Hyundai made a bid of $224/mt CFR for Russian A3 on Wednesday so it would not pay HMS I at $253/mt CFR, a Seoul trader said. The price of A3 is typically $8-10/mt lower than HMS I, he explained.
Offers for HMS 80:20 in-bulk are prevailing at $250-$255/mt CFR Vietnam but there are no deals, a Vietnamese trader said.
Platts assessed East Asian bulk HMS I/II 80:20 scrap on Wednesday at $240-$245/mt CFR, up from the previous week's $235-$240/mt CFR. The implied midpoint of $242.5/mt was $5/mt higher. This was the fifth successive price increase since March 2 when Platts assessed HMS I/II 80:20 at $179-$185/mt CFR East Asia.
On Wednesday, Hyundai Steel was heard by Japanese and Korean trading sources to have bid H2 scrap at Yen 22,000/mt FOB ($199/mt) and Shindachi scrap at Yen 24,500/mt FOB on Wednesday, unchanged from its purchase prices for Japanese scrap last week.
Platts assessed its weekly H2 scrap price at Yen 22,000-22,500/mt FOB Tokyo Bay, up from last week's assessment of Yen 22,000/mt FOB. The implied mid-point of Yen 22,250/mt FOB was Yen 250/mt up from last week.
A Tokyo-based scrap trader said Japanese scrap prices have been increasing on active scrap loading, and Japanese traders are currently targeting Yen 23,000/mt FOB for H2 export.
There could be some Japanese suppliers who will sell H2 scrap at Yen 22,000/mt FOB because another South Korean mill, Dongkuk Steel Mill, purchased Japanese H2 scrap at this same level last Friday. But Japanese suppliers expected Hyundai would have to pay a premium extra of Yen 300-500/mt to secure larger volumes this week.
Another trader in Tokyo said his company would likely divert its Japanese scrap exports to Vietnam if Korean mills do not accept higher prices, because demand in Vietnam is strong and offered the prospect of higher export prices.
Japanese traders are currently offering to Vietnamese customers at $240-245/mt CFR for H1/H2 50:50, equivalent to Yen 22,755-23,310/mt FOB for H2 material. No recent Japanese H2 scrap bookings are heard by Japanese and Vietnamese trading sources.
Offers for H2 scrap a week ago were at $220-225/mt CFR Vietnam and a booking was heard done at $221/mt CFR two weeks ago.
Another Vietnamese trader believed that the workable price for H2 should be $235/mt CFR (which is equivalent to Yen 22,755/mt FOB). "I haven't heard of any bookings. I think this is because this price doesn't work for the Japanese," he said Wednesday.
Domestic scrap prices in Japan also rose this week. Tokyo Steel Manufacturing, Japan's leading mini-mill lifted its scrap buying prices twice effective April 2 arrivals and April 6 arrivals and its price increases during the first week of April reached Yen 1,500-2,000/mt.
The company is currently paying Yen 20,500/mt for H2 material at its Utsunomiya works, north of Tokyo.
Japanese traders are currently paying Yen 20,000/mt FAS to collect H2 material for export at Tokyo Bay area, up Yen 500-1,000/mt from a week ago.
