Japan's September scrap exports fall further

Japan's ferrous scrap exports in September fell to their lowest level since January 2014, driven by diverging price shifts between domestic and seaborne markets.

September exports fell further by 14.4pc from the previous month to 467,000t, pushing January-September exports down by 17.3pc from a year earlier to 5.8mn t, Japan customs data showed.

Exports in the fourth quarter are set to edge lower further with strong domestic demand . Japan's domestic scrap price has rebounded since mid-September, led by an aggressive price increase from Tokyo Steel. Domestic scrap collection prices rose by ¥11,000/t ($96.80/t) at Tokyo Steel's Tahara plant and ¥9,000/t at its Utsunomiya plant between mid-September and the end of October.

But overseas buyers are struggling to maintain profitability with prices of finished products under pressure. The Asian steel market is subdued with Chinese steel prices falling steadily and many countries' domestic steel markets not fully recovered from the impact of the Delta variant of Covid-19. All these factors prompted overseas buyers to stay cautious of Japanese scrap that has commanded a high price.

Exports to South Korea in September fell by 37pc from the previous month. South Korean steel producers sought scrap from domestic and overseas suppliers to replace Japanese scrap.

Exports to Vietnam and Taiwan rebounded from August but January-September shipments still registered a steep fall against a year earlier. Buyers have been less interested in Japanese scrap since September because of the wide price gap between containerised scrap and bulk scrap from other origins.

Japan ferrous scrap exports (t) Sep % &#177; vs Aug % &#177; vs Sep &#39;19 % &#177; vs Sep &#39;20 Jan-Sep % &#177; y-o-y South Korea 235,390 -37.1 -13.5 -6.5 2,360,690 5.6 Vietnam 112,793 32.3 -54.6 -58.4 1,808,555 -25.7 Taiwan 48,894 56.5 27.2 0.7 492,104 -48.5 China(mainland) 10,711 -38.1 243.1 331.2 361,107 2428.5 Bangladesh 7,522 N/A -68.3 -92.8 300,113 -48.3 Others 51,346 37.2 3.6 -25.8 489,760 -39.4 Total 466,655 -14.4 -26.5 -37.5 5,812,329 -17.3 Source: Japan customs

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