Japan: Kanto scrap prices hit 19-month high amid rising export demand
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- Mills increase purchase prices to prevent scrap outflows
- Global scrap supply tightens, Iranian billet shipments slow
Japan Metal Daily: Electric furnace steelmakers in Japan's Kanto region raised steel scrap purchase prices by around JPY 2,000/t ($13/t), led by Tokyo Steel, which increased prices at its Utsunomiya plant and Tokyo Bay Satellite Yard from 12 March. Other regional mills followed the move. As of 12 March, mills' purchase prices for H2 grade scrap were heard around JPY 47,500-49,000/t ($298-307/t), marking the highest level in about 1 year and 7 months.
The price rise reflects concerns over tightening supply and strengthening export prospects. Tokyo Steel expanded its increase from JPY 1,000/t ($6/t) to JPY 2,000/t ($13/t), citing growing caution over potential scrap exports to Vietnam. Market participants also pointed to slower Iranian billet shipments to Asia amid Middle East tensions and constraints in procuring US scrap, which have heightened regional dependence on Japanese material.
Domestic sentiment in the Kanto scrap market remained firm, with several electric furnace mills raising prices in tandem with Tokyo Steel to secure supply. However, scrap arrivals were reported to be largely unchanged, indicating that the price hikes are aimed more at preventing outflows than responding to stronger domestic consumption.
Tokyo Steel set its H2 price at JPY 48,000/t ($301/t) across its four plants, while the Tokyo Bay Satellite Yard price reached JPY 48,500/t. ($304/t) Market participants noted that domestic purchase prices have slightly exceeded Gulf export benchmarks, reversing the earlier trend where export prices led the market.
Looking ahead, participants expect firm price momentum in the near term, supported by export inquiries, particularly from Vietnam and tighter global raw material availability. Mills indicated the possibility of further hikes, as the Japanese scrap market is likely to maintain firm momentum in the near term.
Note: This article has been written in accordance with a content exchange agreement between Japan Metal Daily and BigMint.
