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Japan

From a low of Yen 151.94, the Japanese currency has bounced back 14% in relation to the US dollar, pushed by higher local interest rates which the Bank of Japan had stubbornly resisted for many months. Japan recorded its biggest trade deficit in 2022, mainly the result of much higher import costs for energy. Higher energy bills are believed to have begun affecting the financial results of Japanese companies in the current fiscal year.

Copper rolling mill production recorded year-on-year declines for 12 consecutive months leading up to December owing mainly to the slump in demand from the Chinese phone industry, although a slight recovery has been seen from the domestic automotive sector.

The local market for No. 1 copper scrap has become dull, with reduced generation and less demand from mills. Trading in No. 2 copper scrap has been relatively active, supported by demand from Chinese smelters.

Japan’s weak aluminium market is facing less demand from the automotive industry and prices are being pushed lower by the strong exchange rate. The shredded aluminium scrap market is being sustained by stronger demand from China which is struggling to secure shredded from a USA shivering in the cold weather.

Domestic stainless steel scrap prices have been bearish despite strong LME values and Posco’s return to the market after a few months’ absence as a result of hurricane damage.