Early indications our of SMU industry sources is for Midwest scrap prices to be $30-$45 per ton higher than what we found at the beginning of February. Negotiations are continuing with a number of mills but we have heard of a few deals being done on prime grades at +$40 per gross ton.
We heard from one Chicago area scrap supplier of sales being made at $437 per gross ton delivered for #1 busheling and $432 per gross ton on bundles.
As we discussed scrap with a service center executive he used the former CEO of Steel Dynamics, Keith Busse rule of thumb formula of taking busheling plus $150 to get your all in hot rolled cost our of a mini-mill. If correct, this would put the HRC cost number around $587 per ton (+/- $20 per ton).
We will continue to follow the scrap markets through the week and report further.
John PackardRead more from John Packard
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