Japan’s November Kanto H2 scrap tender price moves lower on month

November's Kanto H2 grade scrap tender saw one successful bid at a lower price month over month on both a yen and dollar denominated basis Nov. 12 against a recent backdrop of softening seaborne spot pricing sentiment.

The winning bid was awarded at Yen 45,180/mt ($294/mt) for a 15,000 mt cargo, down Yen 500/mt and $14/mt from last month's tender, according to multiple trade sources and Kanto Tetsugen's website.

The 15,000 mt cargo was heard bound for Vietnam, with the estimated conversion price around $338-$340/mt CFR Vietnam, according to market sources.

After a steep month-over-month increase seen in October's Kanto H2 grade scrap tender price, the November price was heard falling largely within the expectations of market participants.

"For a 15,000 mt H2 cargo, freight rates are around $40/mt, so it seems like [the tender] price is rather reasonable, especially considering that bids last Friday [Nov. 8] for 5,000 mt H2 scrap at $288/mt FOB Japan were not accepted by suppliers," a Japan-based trader said.

However, some Vietnamese mills said the tender price was higher than their current acceptable bid levels, with some players continuing to monitor from the sidelines for greater price clarity in the near term.

Fewer H2 seaborne offers were heard available this week amid limited vessel availability for January, increasing freight rates, and moderate downstream demand.

Domestic FAS collection prices for H2 grade remained rangebound week over week at Yen 42,000/mt Nov. 12.

Platts, part of S&P Global Commodity Insights, last assessed the weekly H2 ferrous scrap price at Yen 44,500/mt ($289/mt) FOB Tokyo Bay Nov. 6.