Japanese scrap dealer co-operative Kanto Tetsugen's monthly export tender continued to rise for January, driven by increased interest from buyers in Bangladesh.
A total of 15,000t of H2 scrap was concluded in the 16 January export tender at ¥53,081/t fas, marking the third consecutive month of price increases and a rise of ¥2,061/t compared with the previous month. This brought the fob price to an equivalent of ¥54,081/t or $370.42/t, with the cargo destined for shipment to Bangladesh.
Bangladeshi buyers re-entered the seaborne market after a prolonged period of inactivity following the country's elections. Steel mills also bid for deep-sea bulk cargoes at approximately $420/t cfr for HMS 1/2 80:20 basis, according to market participants.
The larger than anticipated increase in the Kanto tender is expected to push sellers' target prices even higher. Tokyo Steel announced a ¥2,000/t increase in domestic collection prices at all of its mills to align with the latest Kanto tender. The H2 price at the Utsunomiya plant after this adjustment will be ¥53,000/t delivered to the mill.
Export negotiations are likely to slow with the substantial gains in the Japanese domestic market, as steel producers need time to absorb the sharp price increases. Vietnamese buyers had already purchased H2 at $402-403/t cfr prior to the tender, equivalent to around ¥52,500/t fob Japan.
The Argus H2 fob Japan assessment was ¥51,600/t on 15 January, with the December monthly average at ¥51,075/t fob Japan.
