Economy
Asian Scrap Markets
Written by Brett Linton
October 11, 2013
On the Far East Asia side, market for finished products is still weak and in an oversupply situation. Most Asian mills coming into October will resume full production schedules after the summer time electricity curtailments. However, this added production is going into a weak finish demand situation.
Consequently, even with the recent slide in the US$ (about 3% or approx $5-$6/metric ton), prices on steel scrap did not improve. The market is still in a situation of weak demand on scrap as mills are buying on an as-need basis. Last bulk confirmed sales still at $363-$365/metric ton CFR Korea. Iron ore 63% stable in the low $130s/dry metric ton.
The oversupply situation and the currency fluctuations created short term imbalances in the Asian region with China/Korea/India export offers being competitive into different Asian markets. Common expectations are for demand to improve into the end of the year. However, it has been a relatively strange 2013 with scrap prices, for the most part, been very range bound throughout 2013 (+/-$10/mt from a base of $350/metric ton CFR basis).
I apologize for the short note, but honestly, not much to write about. Indicators that should show bullishness are all tempered by a weak finish product environment. (Written by: Damon Sun, Daido International)
Brett Linton
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