The monthly export tender by the Japanese scrap dealer co-operative Kanto Tetsugen rose in March despite a stronger yen, driven by continued demand from Bangladesh.
The tender for 15,000t of H2 scrap settled at ¥44,226/t ($300/t) fas today, marking a ¥1,026/t increase from a month earlier. This translates to a fob price of ¥45,226/t, or $307.53/t. The yen appreciated by 4.7pc to ¥147:$1 over 12 February-11 March, partially offsetting the gain from the yen-equivalent price.
The March cargo is expected to be shipped to Bangladesh, similar to previous tenders. Over the past six months, Bangladeshi buyers have shown greater interest in Japanese bulk scrap on concerns over tightening supply from the US. The tradeable price for deep-sea bulk cargo to south Asia increased by $10-15/t in the past month, prompting mills to raise their bid levels for Japanese scrap.
But buyers in other markets were less likely to follow this upward trend closely. Most had maintained target prices below ¥43,000/t fob before the tender, as current steel prices were not high enough to absorb the continued rise in ferrous scrap costs. Mills may turn to billet, which remains more competitive.
The Argus H2 fob Japan assessment stood at ¥42,600/t on 10 March, with the February monthly average at ¥42,185/t fob Japan.
