Skip to main content


After the conclusion of the Olympic Games in Tokyo, Japan, Taiwan and South Korea have all encountered strong trade barriers arising from container shortages. Where space is available, the unbelievably high cost makes the trade unattractive.

Stainless steel scrap demand in general is following the trend where Asia (excluding India) is lagging behind the EU and the USA. Mills in Europe and the USA seem to have very strong order books and are thus consuming all the scrap they can procure. With the nickel price bouncing around between a low of US$ 17,800 per tonne and highs of US$ 20,500, this has prompted some Asian mills to slow their purchasing of scrap.

In the third quarter, Taiwanese mills’ demand for stainless steel scrap was something of a roller-coaster ride. When China abolished the 13% export tax redemption for stainless coils and flat products in June, demand went from good to extremely high for July and August as COVID negatively impacted many vessel routes. Some Taiwanese stainless mills were faced with raw materials such as ferro-chrome and ferro-nickel not arriving on time and so were forced to find refuge in the domestic stainless steel scrap that was available for purchase. By mid-August, however, demand fell back as mills secured bulk vessels to carry their new purchases of raw materials. In general, Taiwanese mills have the luxury of choosing either to use their own melt shops to produce coils or simply to buy from various competing melt shops in Indonesia.

In a big change that has emerged over recent months, Taiwan is now importing approximately 100,000 tonnes of stainless hot coil from Indonesia each month, up from an earlier 2021 average of 80,000 tonnes.

South Korea’s stainless mills entered full production mode from June and continued this into the third quarter. Their strong demand for stainless steel scrap looks set to continue well into the fourth quarter.

In China, meanwhile, stainless scrap demand has been steady. However, the local market’s pricing of 304 stainless scrap remains below international levels and so nickel pig iron is still the preferred raw material option. Given electricity shortages for various reasons, some mills have been forced to cut back on their production.

The third quarter in Japan was weak owing to the run-up to the Olympics. Following the Tokyo Games, the COVID situation worsened but was back under control by September, leading to increased demand for stainless scrap. Japan resumed imports in small lots during September; this is a trend-changer and it remains to be seen whether the demand will persist for the fourth quarter.

With COVID under better control on the Indian Sub-continent following full-speed vaccination drives, most stainless mills are functioning well and have decent order books. Most labour problems have also been resolved. Demand for stainless scrap has been strong; the only problem is high freight rates which have caused some disruption to imports of lower-value grades such as the 200 and 400 series where the freight component has changed the dynamics of the trade and forced mills to rethink imports.

Large volumes of scrap are generated within India and good demand exists for 200 and 400 series material which is becoming difficult to import owing to high container freight costs. There have also been significant delays as a result of scrap import containers being stuck at trans-shipment ports for long periods of time. Furthermore, stainless mills that export their finished products are also facing extra costs for shipping these overseas. To compensate for this, mills are being less aggressive in their buying of high-priced scrap for their manufacturing.

Demand for ferro-nickel and nickel pig iron has also been very strong in India as many stainless mills use these as substitutes for scrap which is a little more difficult to source.

Overall demand for stainless scrap looks set to be positive in the fourth quarter and most stainless mills in India should end 2021 with a decent performance.