Japanese ferrous scrap export prices to South Korea continued to increase amid rising demand and tight supply.
South Korea's leading EAF mill, Hyundai Steel lifted its bidding price in its purchase tender this week, sources in Japan said Thursday.
Hyundai Steel placed a bid price of Yen 20,800/mt ($185/mt) FOB for H2 grade scrap, Yen 22,800/mt FOB for HS grade and Yen 23,300/mt FOB for Shindachi grade scrap, sources in Tokyo and Seoul confirmed.
These apply to cargoes for shipment by May 15. This bid price of Yen 20,800/mt FOB is in line with expectations by Japanese and Korean trading sources, which told Platts Wednesday they expected the South Korean mill to bid H2 scrap at Yen 20,500-21,100/mt FOB.
Platts assessed its weekly H2 scrap price Wednesday at Yen 20,500-21,000/mt FOB Tokyo Bay, up Yen 700/mt from the mid-point from the previous week's assessment of Yen 19,900-20,200/mt FOB.
"We are targeting the minimum of Yen 21,000/mt FOB for H2. However, Hyundai's bid price of Yen 20,800/mt is not far off and I think Hyundai will be able to secure some material at that price level," a Tokyo-based scrap trader said.
Hyundai booked an estimated 50,000 mt of Japanese scrap last week at Yen 19,900/mt FOB with an extra premium of Yen 300/mt for booking exceeding 4,000 mt and Yen 500/mt for those exceeding 6,000 mt, trading sources said.
Domestic arrivals to Japanese plans could be slow down due to rising South Korean prices for Japanese scrap exports, Kanto-based mill sources said.
"Scrap collectors in Japan will hold off supplying in anticipation of higher prices," a mill official said. However, his mill is unable to lift its scrap purchase prices as rapidly as Korean mills because finished steel prices were still stagnant in Japan, he said.
Tokyo Steel Manufacturing, Japan's leading mini-mill, lifted its scrap buying prices by Yen 500-1,000/mt for all grades at all works and a steel service center from March 23 arrivals.
H2 buying price at its Utsunomiya works has become Yen 17,500/mt, as previously reported.
