Japanese scrap exports increase in July

Japanese ferrous scrap exports rebounded in July after a brief decline in June, supported by increased shipments to south and southeast Asian markets.

• Japan's scrap exports rose by 9.9pc from June and 7.9pc from a year earlier to 616,000t in July, customs data show. Total shipments reached 4.4mn t in January–July, a 18pc increase on the year.
• Vietnam remained Japan's largest scrap buyer in July. Exports to the country rose by 1.5pc on the month to 241,000t. Traders anticipate stronger Vietnamese demand in 2026 as new steelmaking capacity comes on line. Vietnamese mills favour Japanese scrap for its stable supply and shorter delivery times.
• Exports to South Korea recovered by 13pc on the month to 128,000t. Demand was concentrated on prime-grade scrap. Buying appetite for H2 and H1/H2 50:50 grades stayed weak as South Korea's construction sector remained subdued, keeping overall demand well below levels from two years earlier.
• Scrap exports have grown in importance as Japanese domestic demand is unable to absorb most supply. Japanese crude steel output in January–July fell by 4.6pc on the year to 47.46mn t, according to the Japan Iron and Steel Federation.
• Some Japanese traders voiced concerns that the expanded US tariffs on steel and aluminium derivatives could further weigh on the domestic steel industry, given the US is one of the key markets for Japanese steel products.
• Exporters were actively seeking opportunities outside of traditional destinations. Scrap shipments to south Asia rose sharply, with exports to India surging fourfold to 189,000t and exports to Bangladesh rising by 160pc to 738,000t in January–July. Shipments to Indonesia also rose by 177pc to 183,000t in the same period.