[Ferro-Alloys.com] 

According to the Ministry of Finance, driven by increased demand from Bangladesh, Vietnam and Taiwan, Japan’s exports of scrap steel rose 23% to 9.39 million tons in 2020, Which reached an 11-year high. Vietnam is Japan’s largest export destination of scrap steel, exports of 3.41 million tons, an increase of 54.6% year-on-year, and for the first time exceeded exports to South Korea; Export of 2.96 million tons of scrap to South Korea, down 24.6% year-on-year; Exports of 1.11 million tons of scrap steel to Taiwan, China, increased 70.9% year-on-year. It is worth noting that Japan's exports of scrap to Bangladesh continue to grow, with exports of 868,000 tons in 2020, nearly 2.7 times higher than in 2019.

Much of Japan’s growth in scrap exports in 2020 came from the first half of the year. Affected by the new crown pneumonia epidemic, Japanese steel producers had to reduce production, resulting in weak domestic demand for scrap. In this case, Japanese scrap suppliers are forced to seek more overseas markets and supply scrap at more competitive prices. In particular, in February-April, a large number of scrap steel poured into the export market, resulting in scrap sea prices fell to the lowest level in the year.

South Korean steelmakers, traditionally Japan’s biggest importer of scrap, have also failed to escape the epidemic, so imports of scrap fell 32.4% to 4.39 million tons in 2020, down to a 25-year low. Industry insiders said that Japan’s exports of scrap steel may increase further in 2021 due to “China’s potential purchasing power”. Increased demand for steel in Vietnam, Malaysia and Bangladesh and production of new capacity will provide additional support for Japanese scrap exports.