Tokyo Steel Manufacturing is to cut its ferrous scrap-buying prices by Yen 500-1,000/mt ($4.6-9.3/mt) from Friday for deliveries to its works and scrap yards across Japan, the company said Thursday.
It will be Tokyo Steel's seventh price cut since September 27, with Thursday's announcement taking the total reduction to Yen 4,000-5,000/mt, depending on the works and the scrap grade.
From Friday, Tokyo Steel will pay scrap collectors Yen 29,500/mt for H2 grade material delivered to its Utsunomiya steel works in the northern Kanto region, its Kyushu works in western Japan, and Tahara in central Japan.
H2 material delivered to its Okayama works in western Japan and to its Takamatsu Steel Center on Shikoku Island will fetch Yen 28,500/mt, the company said.
Tokyo Steel procurement officials were not available for comment.
A Tokyo-based scrap trader said deliveries of scrap to mini mills, including Tokyo Steel, have been smooth of late because the prices traders were offering for scrap to be exported through Tokyo Bay were lower.
Traders are currently paying around Yen 27,500/mt free alongside ship at Tokyo Bay for H2 grade scrap for export, the trader said.
"This is lower by Yen 1,500/mt from the previous week to reflect weaker overseas scrap prices," he said. Mini mills are still paying more and, as a result, will continue receiving sufficient volumes. Steelmakers might even be able to lower their buying prices further, he said.
Another scrap trader in Tokyo said the latest bid for Japanese H2 material by South Korea's Hyundai Steel on Wednesday was Yen 26,000/mt FOB, down Yen 6,000/mt from the Korean mill's previous booking in early October.
Korean domestic scrap prices are also falling as several mini mills cut their buying prices.
Steelmakers such as Dongbu Steel and Korea Iron and Steel lowered their scrap-buying prices by Won 10,000/mt ($9.5/mt) for all grades from October 23.
Posco will lower its prices by Won 10,000-15,000/mt, depending on grade, at both its Pohang and Gwangyang steel works from October 24.
Hyundai Steel has said it will reduce its buying prices by Won 10,000/mt at its Incheon, Pohang and Dangjin works from October 27.
Source: Platts
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