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Japan's largest electric arc furnace operator and effective benchmark price-setter raised its purchase prices by ¥500 ($6) per tonne.
As a result, it is now paying ¥24,500 per tonne for deliveries to Utsunomiya; ¥24,000 per tonne for seaborne deliveries to its Okayama factory; ¥23,500 per tonne for overland deliveries to the plant, as well as all deliveries to its Kyushu and Tahara plants; and ¥22,500 per tonne for those to its Takamatsu service centre.
The hikes follows a ¥500 per tonne across-the-board increase over the weekend in reaction to last Friday's export tender held by scrap dealers in the Tokyo area that saw their prices shoot up by over 13% from month-earlier levels.
The average winning bid at the tender came in at ¥25,643 per tonne fas.
The big jump took export prices way past domestic prices, leading market-watchers to say that it was only a matter of time before local mini-mills further lifted their purchase prices in response.
On the other hand, scrap prices could be set for a certain level of volatility as the markets struggle between weak demand and rising export prices.
The rally in the Japanese scrap market is gathering pace as Tokyo Steel hikes its purchase prices for a third time in the space of a week after a big jump in export prices.