en.Wedoany.com Reported - Japan's Kanto Tetsugen export tender for May 2026 extended its bullish momentum, recording a tenth consecutive monthly increase, supported by firm domestic scrap market sentiment and limited export availability. The tender concluded 10,000 tonnes of H2 scrap at a FAS price of ¥54,602/tonne (approximately $346/tonne), up ¥273/tonne (approximately $2/tonne) month-on-month. The concluded level equates to a Japanese FOB price of around ¥55,500/tonne (approximately $352/tonne).
The sustained upward trend did not come as a surprise to the seaborne market, as domestic scrap prices in Japan remain firm and export supply continues to be constrained. Market participants noted that most cargoes under April contracts have now been arranged for shipment. The Japanese Yen has strengthened moderately against the US dollar over the past month, appreciating from around ¥159.3 per dollar on April 12 to nearly ¥157.6 per dollar currently. The stronger currency has also contributed to pushing up export offer levels from Japanese suppliers by raising the dollar-denominated replacement cost.
A regional scrap trader commented: "Japanese export prices continue to be strongly supported by robust domestic market conditions and limited spot scrap availability. Exporters are under little pressure to significantly lower their offers, especially with local mill procurement sentiment remaining strong." Most market participants indicated that the latest Kanto cargo is likely destined for Vietnam, where local procurement sentiment is relatively stable due to decent finished steel demand and active construction activity. In contrast, buying interest from Bangladesh remains weak, with no major deals heard this week. Buyers continue to stay away from new orders, affected by weak finished steel demand, liquidity pressures, and ongoing financial constraints.
A Bangladeshi importer stated: "High freight costs, payment delays, and LC-related issues continue to affect import activity. Buyers remain cautious and only book material when absolutely necessary." Market participants added that several exporters have increasingly shifted their focus towards Southeast Asian destinations such as Indonesia, Chinese Taiwan, and Vietnam, where deal feasibility and payment visibility are relatively better compared to Bangladesh. A regional market participant noted: "Vietnamese buyers might still be acceptable at CFR $395/tonne for H2 scrap, but current Japanese export offers are mostly above CFR $400/tonne, making it difficult to conclude new deals at the moment."
In the domestic market, H2 scrap prices were heard around ¥53,000-53,500/tonne ($335-339/tonne), while dock purchase prices stood at ¥52,000-52,500/tonne ($329-332/tonne) FAS.
Tokyo Steel raised its scrap purchase prices at all works by ¥1,000/tonne ($6/tonne) effective May 12, 2026, pushing the H2 procurement level to approximately ¥54,000/tonne ($343/tonne), while the price announcement for the Takamatsu works remains suspended. The latest increase reflects firm domestic scrap fundamentals in Japan, supported by active mill procurement, limited scrap generation, and steady export demand following the recent stronger Kanto tender.
Japanese scrap export prices are expected to remain firm in the near term, underpinned by enhanced domestic mill procurement and limited scrap supply. However, higher offer levels may continue to face resistance from overseas buyers, particularly in Southeast Asia, where weak steel demand, freight cost pressures, and liquidity constraints are affecting import appetite. Market participants anticipate closely monitoring upcoming export negotiations and domestic mill price movements to gain clearer directional guidance ahead of the next Kanto tender, tentatively scheduled for the second week of June.
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