Firmer Chinese steel markets have been supporting sentiment in the Chinese scrap market, keeping buyers optimistic about September and October, sources told Fastmarkets on Tuesday August 31.
- Prices in China inch up amid buyer optimism
- Taiwanese buyers could start paying more
Spot prices for steel scrap imported into China edged up on Tuesday August 31 amid improving sentiment in the steel markets, sources said.
Fastmarkets’ calculation of the steel scrap, index, heavy recycled steel materials, cfr north China, was $534.64 per tonne on August 31, up by $0.47 per tonne from Monday’s index and up by $4.22 per tonne from the Friday August 27.
“We are observing stronger end-user demand for rebar recently, which is supporting buyers’ expectations for scrap prices. We just need to wait and see to what extent [the bullish sentiment in] the finished steel markets could pull up scrap prices,” a trading source based in Zhejiang province told Fastmarkets.
“We are keeping our bids for scrap stable for now, but we are optimistic about the [downstream] demand in September and October. It is highly possible our bids could increase in the short term,” a mill source based in Hebei province said.
Bids for imported scrap were heard at $515-535 per tonne cfr north China on Tuesday. Buyers who had no intention of booking cargoes gave indicative bid prices of $500 per tonne cfr north China, sources said.
Offers from Japan were heard at $585-600 per tonne cfr China on August 31, widening downward by $15 per tonne from the $600 per tonne offer levels in recent weeks after major scrap buyer Tokyo Steel reduced their buy prices for most grades of domestic scrap as of Saturday August 28.
“The market level for scrap exports in Japan has come down a little, but sellers are still cautious about exporting. They are waiting for more bids to provide them with a clearer picture of the current export market,” a Japanese trading source told Fastmarkets.
Taiwanese buyers may well start to purchase at higher prices this week, a Taiwanese trader told Fastmarkets. “This is due to the high freight rate from the United States’ West Coast to Taiwan, which is currently around $50 per tonne,” he said.
Buyers were bidding at $440 per tonne cfr Taiwan on Monday August 30 but were slowly increasing their bids to $440-442 per tonne cfr Taiwan, key market participants said. Higher bids of up to $447 per tonne cfr Taiwan were heard, but this could not be corroborated with key buyers.
Offers were at $442-445 per tonne cfr Taiwan, a buyer source at a steel mill said. Other sellers reported offers at $445 per tonne cfr Taiwan.
Bulk Japanese H1&H2 scrap cargoes were offered at $475 per tonne cfr Taiwan, but bids were at $460-465 per tonne cfr Taiwan.
“There is little impetus for buyers to bid too high above containerized prices for bulk Japanese scrap, especially with the offers already at a $30 per tonne premium to containerized cargoes,” a scrap trader in Singapore told Fastmarkets.
Fastmarkets’ daily price assessment for containerized steel scrap heavy melting scrap (HMS) 1&2 (80:20) United States material import, cfr main port Taiwan was $442-445 per tonne on Tuesday, narrowing upward by $2 per tonne from $440-445 per tonne cfr Taiwan a day earlier.
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