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No.2 HMS in New Export Market Hardly Concludes Contract Yet
= South Korea's Dongkuk Steel procures No. 2 HMS at Y 34,000 FOB =
Kanto Tetsugen Cooperative Association holds the tender for joint export sale today or February 9. Because there are hardly new deals from overseas buyers in the recent new export market, the severe sentiment continues in the market. The buyers stayed on the sidelines by the downward trend of the international market before the long holidays for Lunar New Year. The new deals are sluggish.

The difficulty in concluding the new contract of No.2 HMS is not resolved yet. On February 6, Hyundai Steel, South Korea's steelmaker, made a bid at Y 34,500 FOB on No.2 HMS basis, and at Y 39,500 FOB for Shindachi Bara, down by Y 1,000 from the previous week respectively. The company procured totally 40,000 tons level despite the price reduction. Of the total, high-grade ferrous scrap occupied around 20,000 tons, and the sale of only No.2 HMS was not available yet.

In addition to this, the electric steelmakers in South Korea, such as Dongkuk Steel and Kisco, who entered the market after Hyundai, tried to reduce the price further. On February 7, Dongkuk Steel procured Japanese ferrous scrap at Y 34,000/ton FOB on No.2 HMS basis. The export price for South Korea declined further by Y 500 from the contract price for Hyundai. The contract price for Dongkuk Steel is equivalent to less than Y 33,000, which was converted to FAS price. And this price is at least lower than Y 1,000 to 1,500 than FAS Tokyo Bay price, whose benchmark price as of February 8 marked Y 34,000 to 34,500. Despite the further price reduction, the quantity of concluding the contract seems to reach 20,000 tons level.

The new deal from Vietnam, which was regarded as the expected country for major export destination, was still sluggish. The recent purchase idea by the buyers in Vietnam was inactive, as it was US$ 345/ton CFR on No.2 HMS basis. Some supplier pointed out that the negotiation price level for Vietnam was around US$ 345 to 350 CFR. Because there were some buyers, who needed to procure imported ferrous scrap, mainly in north area of Hanoi, some supplier expected the real join to the market by buyers in Vietnam after The Vietnamese New Year (Tet) holidays.
last modified : Fri 16 Feb, 2018 [10:08]
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