Steel Products
U.S. Scrap Prices “Sloppy” as Mills Buy at Lower Levels
Written by Diana Packard
August 4, 2013
One of our scrap sources – a Northeast based shredding company – reported sales to one of the mill scrap brokerage companies with two sales on shredded scrap. One 35,000 ton lot at down $20 per gross ton shipping by rail, a second lot of shred sold down $15 per gross ton to ship by truck. The shredding company also reported a 10,000 ton sale to a southern mill down $10 per gross ton. Busheling was referenced as going sideways and cut grades were down $5 per gross ton. The shredder told SMU, “Market kept getting weaker with each sale.”
Another of our east coast sources provided the following insights from his perspective late last week:
“The market is still developing, but it’s sloppier than most people thought it would be. Dealers are selling into the down market and the mills which are buying are lowering prices. Do we get to down $20 on shred? We might – we are not far from that with deals already at down $15 for shred and tons still not placed. From what I see, this is largely driven by mills which are just not buying much scrap either because they bought a lot in July or are taking maintenance outages in August. I was told there was an overhang of shred from July but that doesn’t make much sense – why would the market have gone so much higher? And we are seeing (and have been seeing for some time) a very tight shred feedstock and cut grade market, and an improving export market.
All in all a complex market – not very transparent at all.”
We should see more scrap deals concluded early this week. The expectation has been for shred to be down $5-$15 per gross ton depending on the market with cut and prime grades moving sideways (remaining the same as July). SMU will have more details as the week progresses and more information becomes available.
Diana Packard
Read more from Diana PackardLatest in Steel Products
Market Chatter This Week
On Monday and Tuesday of this week, SMU polled steel buyers on a variety of subjects, including steel prices, demand levels, sheet prices abroad, inventory, the UAW strike, and what people are talking about in the market
Housing Starts Decline in August
US housing starts slipped in August, according to the latest estimates from the US Census Bureau.
UAW Strike Leads to Ford, GM Temporary Layoffs
Ford and General Motors have announced temporary layoffs in the wake of the United Auto Workers (UAW) union strike.
Unifor, Ford Extend Negotiations for 24 Hours, Put Off Possible Strike
Unifor, which represents union auto workers in Canada, has extended negotiations with Ford, thus delaying a strike.
AISI: Raw Steel Production Rebounds
Raw steel output in the US ticked up for the week ending Sept. 16, a reversal after three weeks of decline, according to data released by the American Iron and Steel Institute (AISI) on Monday, Sept. 18.