The Scrap Market Has Stopped Moving. That's the Problem.

By Siam Sukkhee Trading Co., Ltd — 2026-07-18 — metals recycling Thailand

I watched the prices fall in the first two weeks of July and said nothing, because there was nothing to say.

The numbers were too clean. Too predictable. Depressing, actually.

Vietnam's HMS 1/2 80:20 dropped three dollars a tonne to hit $377 cfr. Taiwan slipped ten. Japan's Kanto tender went down another twelve, more or less. China's domestic heavy melt fell as well. Every benchmark. Same direction. Same fortnight. When everything moves together like that, it's not volatility. It's the market turning its back on you.

The reasons are straightforward enough. Monsoon rains across Southeast Asia have stopped construction dead. Electric-arc furnace mills are on maintenance shutdown. Chinese operators are running negative margins, so they've simply stopped buying. Supply is lining up, demand has evaporated, and everyone with cash is holding it.

That's a buyer's market where no one buys.

Thailand's import mills have gone quiet. They want clearer signals on downstream steel demand before they commit. You can understand the caution — thin margins mean inventory risk is real. Bring in scrap at these prices, wait for orders that don't come, and you've absorbed a loss. So they're waiting. All of them.

But here's where it gets difficult. Thai recyclers depend on reasonably stable import prices to plan their domestic purchasing. When the import price falls week after week without settling, the whole chain breaks. Collectors hold their material. Recyclers can't quote with confidence. Exporters face mills that weren't keen to begin with.

Actually, that's not quite right. The exporters face worse than that. They face the knowledge that Thailand can always pick up Japanese material at lower prices. Japan's still one of the region's primary scrap exporters, and with domestic consumption soft on summer maintenance and overseas buying interest subdued, Japanese supply is queuing up at the bottom of the market. Thai mills know this. So they wait. They know the supply isn't going anywhere.

Argus reckons further declines are coming as the rainy season runs its course. I'd say they're reading the room correctly.

Seasonal weakness in Asian scrap isn't new. This one is sharper than most people expected, though, because regional steel demand was fragile before the rains even started. There's a longer story here — Southeast Asia's ferrous scrap demand is supposed to grow around 50% as regional EAF capacity expands. That's a real structural shift. But it doesn't help anyone managing inventory through a soft July.

Where does it end?

There isn't a visible floor. Not yet. Until post-monsoon construction activity rebounds and Chinese EAF margins improve enough that they start reordering, the buying interest that drives regional recovery simply isn't there. What Thai recyclers can do is straightforward: manage purchasing conservatively, hold off on volume commitments, wait for an import level that mills will actually act on instead of just watch from the sidelines.

Patience isn't a strategy. It's just what you're left with.

Tags: Argus Media, ferrous scrap, Thailand steel, Asian scrap price decline July 2026, Thailand scrap import market 2026, EAF mill demand Asia monsoon