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Japan

It is believed that major cities’ ordinances to prevent the spread of COVID will be eliminated on March 22 and will not be renewed, and more foreign visitors will be welcomed into Japan. This decision has been mainly supported by industrial organizations.

In other developments, many automotive factories are still unable to operate fully owing to semiconductor shortages which have been forcing generally slower local manufacturing activity. At the same time, the Yen has started falling sharply and this may lead to stagflation in Japan.

In January, Japan’s copper scrap exports fell below 20,000 tonnes for the first time since 2019, largely as a result of the slump in shipments to Malaysia where new import measures have been imposed; meanwhile, exports to China fell from around 15,000 tonnes to nearer 12,000 tonnes. The No. 1 copper scrap market remains tight; while demand from rolling mills is strong, there is not enough scrap available to cover their needs.

The local aluminium market has been thrown into confusion by the decision of a Korean UBC consumer - a price leader in Japan - to drastically reduce its buying prices without any prior notice, prompted by the sharp fall on the LME. Possible disruption to the supply of 2000 tonnes per month of ADC12 from Russia has been pushing up Chinese ingot prices. Local consumers have not been impacted as yet as they are not operating fully.

In the stainless steel sector, the suspension of LME trading has been keeping nickel scrap activities at very low levels and even some bilateral transactions apart from LME prices are being seen. SUS scrap tightness was reflected in January with the lowest export volumes for seven months, including a slump in shipments to both Taiwan and India.