Taiwan Scrap market may be quiet in May

TAIWAN May 21 2014 10:08 AM

TAIPEI (Scrap Register): The Taiwanese scrap market is expected to be quiet in May with electricity restrictions being placed on Taiwanese mills likely to inhibit production, said TSI.

According to TSI, the April monthly average of TSI’s index for Taiwanese imports of HMS #1&2 80:20 gained 2.5% month-on-month, equating to a rise of $8.50 a ton.

Early in the month prices for Taiwanese scrap imports rose in the face of an uptick in demand. This extra demand came as the annual restrictions imposed on electricity consumption in the country loomed large on the horizon - mills ramped up production with the aim of building inventory for periods when their production will be curtailed.

Traditionally output is cut from three shifts per day to two in the summer months as a consequence of the usage limits. Local scrap prices also rose by around $10 a ton during this period, with the aim of bringing pricing more in line with the international market.

Scrap pricing then proceeded to fall in the latter part of the month, as mills had filled their predicted inventory requirements going forward, meaning they turned away from making any further purchases. Domestic demand for long products also remained weak, further dampening scrap demand and explaining the drop in pricing.

The monthly average of TSI’s index for North Asian HMS #1 scrap imports fell by $1 a ton to $361 a ton in April, whilst the monthly average of TSI’s index for ASEAN imports of HMS #1&2 80:20 was unchanged at $356 a ton (both of these indices are currently under development)