Hyundai Steel raises purchase prices for Japanese scrap metal

The Korean steelmaker placed orders for Japanese H2 scrap on August 18 at 42,500 yen/t ($315/t) fob. The plant previously offered H2 scrap at 40,500 yen per tonne on July 21st.

The steel mill also offered H1/H2 scrap at 43,000 yen per ton and crushed scrap at 47,000 yen per ton. Offer prices for HS and Shindachi grades remain unchanged at 48,000 yen/ton.

A South Korean trader learned that 42,500 yen per ton was the lowest price offered to the plant on Wednesday. He believes that Hyundai accepted the offer because otherwise it would not be able to get any materials. He notes that scrap metal markets in Japan, Vietnam and China are strengthening. “Turkish scrap buying prices have gone up,” says another South Korean trader. “For low prices, scrap metal suppliers don’t have many of them.”

In Japan, Tokyo Steel, the leading electric arc furnace operator, will pay 43,000 yen per tonne of H2 grade scrap delivered by truck to the Utsunomiya steel mill from August 19. Previously, from July 29, the plant paid 41,000 yen per ton.

Japanese scrap prices have risen rapidly in Vietnam. Offers for Japanese H2 scrap were at $365/t in Vietnam a week ago before the long Japanese holiday, but prices have since jumped to $395-400/t in francs.

Vietnamese buyers can pay around $375-380 per tonne of francs, says a trader who describes the uptrend in scrap metal prices as "crazy". Prices rose $10 a tonne in the afternoon from $385-390 a tonne Thursday morning, "right after Tokyo Steel raised prices," the buyer says. But it's hard to say how much Vietnamese buyers are willing to pay for H2 because the Chinese steel market has weakened, he adds.