Prices for cargoes of steel scrap exported from Japan fell for most grades on Wednesday September 16 following a drop in appetite among South Korean steelmakers and a worsening of the market environment, sources have told Fastmarkets.
Several producers in South Korea were undertaking maintenance work in September-October, reducing the requirements for scrap in the country and thus also reducing the likelihood of new deals, a local mill source said.
One major South Korean steelmaker will cut its steel output by around 300,000 tonnes over the next month because of maintenance outages, according to a Japanese supplier.
Low demand in South Korea, together with
continued buying of Japanese scrap in Vietnam, has widened the gap between the two markets over the past week, creating a very divided market landscape.
Japanese scrap is generally sold to South Korea at lower prices than to Vietnam because the tonnages involved to South Korea, which are usually 2,000-3,000 tonnes, were lower than those to Vietnam, which generally takes more than 5,000 tonnes per cargo.
There were also more Japanese exporters able to service the Korean market than...