Ferrous Scrap

HRC vs. prime scrap spread narrows in May

Written by Ethan Bernard

May 17, 2024

The spread between hot-rolled coil (HRC) and prime scrap prices narrowed this month, according to SMU’s most recent pricing data.

SMU’s average HRC price edged down this week, while the average May price for busheling scrap has been flat since March.

Our average HRC price stood at $775 per short ton (st) as of May 14, down $5 from a week earlier.

Meanwhile, busheling tags remained sideways at an average of $410 per gross ton in May. Figure 1 shows price histories for each product.

After converting scrap prices to dollars per short ton for an equal comparison, the differential between HRC and busheling scrap prices is $409/st as of May 16, down $60 from a month earlier (Figure 2). This is the narrowest it’s been since a reading of $338 in mid-October .

Figure 3 explores this relationship differently: We have graphed HRC’s premium over busheling scrap as a percentage. HRC prices now carry an 89% premium over prime scrap, down from 104% a month ago.

By the way, did you know SMU’s Interactive Pricing Tool can show steel and scrap prices in dollars per short ton, dollars per metric ton, and dollars per gross ton?

Ethan Bernard

Ethan Bernard is managing editor for Steel Market Update. He previously worked for American Metal Market as a copy editor in the New York office for two years, starting in 2008. Later, he copy edited AMM’s monthly magazine on a freelance basis from 2015 until 2017. With experience in financial copywriting and textbook publishing, he holds a BA in Comparative Literature from UC Berkeley, and an MFA. in Creative Writing from New York University. He can be reached at ethan@steelmarketupdate.com or 724-759-7871.

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