South Korean steelmaker POSCO has continued to give bids for Japanese scrap for the third consecutive week, with higher price levels shared with the Japanese suppliers. Market sources report that this recent push by POSCO for Japanese scrap is in preparation for the return of its blast furnace No. 4. As SteelOrbis reported previously, for the modernization works at blast furnace No. 4 at its Pohang mill, POSCO has made an investment of about KRW 530 billion ($383.6 million), with the BF scheduled to be recommissioned by the end of June this year.
POSCO has shared bids for Japanese shredded scrap at JPY 58,000/mt ($362/mt) CFR, JPY 500/mt higher than the Japanese yen-based bids shared by the producer for this grade on June 21. However, due to the depreciation of the Japanese yen, dollar-based prices have moved up only by $1/mt week on week. This level indicates FOB-based prices for Japanese shredded scrap are at around JPY 55,000/mt ($343/mt, up by $1/mt amid exchange rate fluctuations.
Considering the gap between ex-Japan shredded and H2 scrap prices at around JPY 3,000-4,000/mt, indications for ex-Japan H2 prices for South Korea are still at JPY 51,000-52,000/mt FOB, increasing by $1/mt to $318-324/mt FOB week on week.
$1 = JPY 160.38