Japanese scrap dealer co-operative Kanto Tetsugen's export scrap tender for December was done at higher-than-expected levels on 9 December after failing in November.
There were three lots settled in the December tender, with 3,000t done at ¥47,710/t, 5,000t at ¥47,610/t and 5,000t at ¥47,442/t. The average price was ¥47,568/t ($349.70/t) fas, down by ¥2,297/t from October. But the equivalent dollar price was up by $8.70/t because of the appreciation of the Japanese yen. The Japanese yen rose from ¥146.40 against the dollar to ¥136.60, up by 6.7pc over the month between the two export tenders.
The average fob price of tender cargoes was equivalent to ¥48,568/t.
The workable level for H2 was at ¥44,500-45,000/t fob in the beginning of the week, but the tender result will likely provide a boost to the already-bullish sentiment held by Japanese suppliers, with some saying that they are now targeting ¥48,000/t fob to the export market.
The Japanese scrap export market had been bottoming out since the end of November until purchasing appetite gradually recovered in overseas markets.
Taiwanese buyers started to restock from Japan as the containerised scrap price kept rising with limited supply. The Argus containerised HMS 1/2 80:20 cfr Taiwan assessment increased by $40/t from 21 November to $360/t on 8 December.
South Korean mills entered the market to buy Japanese scrap after the domestic scrap market ended the two-month downtrend and looked set to rebound. China's easing of its Covid-19 restrictions further boosted sentiment, pushing Vietnamese buyers to build up inventories for production needs after the lunar new year holiday.
Market participants expected Tokyo Steel to increase its collection price soon as the H2 price in the domestic market was now below that of the seaborne market, at ¥45,500-46,500/t.
