Final Thoughts

An executive with one of the larger scrap companies told us that trading finally got under way in the Southeast over the past 24 hours. We were told, “Scrap trading got underway in the Southeastern markets late yesterday and today.  While demand remained intact for the most part, bearish sentiment seems to be on the increase.  Additional supplies from the East Coast exporters surfaced in the region once again, adding supply and pressuring prices for obsolete grades.  There seems to be a growing sense that domestic steel prices may be fading, potentially shortening lead times and diminishing domestic scrap demand.  Softening pig iron, DRI, and HBI prices into NOLA is also expected to keep prime prices in check heading into August.”

This same executive pointed out that the weakness is in the area of long products which use obsolete grades of scrap. The sheet mills, which use prime grades of scrap, have been running “full out” and have helped keep prime grades of scrap from falling over the past couple of months.