Ferrous Scrap

Miller on Scrap: More malaise, or will tariffs lead to higher prices?

June 6, 2025

The US ferrous scrap market traded sideways for June. This move was interpreted by several players as slightly optimistic given the severe drop in prices in April and May. So, what does the trade see ahead for the summer and the rest of the year?

If we review the price trends for the last two years, we can see this year’s pattern taking a similar shape. In both 2023 and 2024, the year started out with higher prices mainly brought on by seasonal factors after prices bottomed out going into Q4 of the previous year. This was followed by weakening price levels as the market drifted into summer. From there, both years’ prices traded sideways to down until mid-Q4, then rallied into December and January. Are we in that same pattern once more?

SMU canvassed several market participants to see what they expect going forward.

One source in the Southeast said demand for scrap in June was stable with most mills buying their normal tonnages. Regarding the future, he said, “We are likely to bounce along the bottom until September.” He noted the lack of export activity is a factor in keeping US prices under control. He added, “Export prices are $40 per ton less than the domestic market.”

SMU contacted an executive at a Midwestern-based trading company to learn how they view future scrap pricing. He said, “I can’t get excited about scrap prices.” He believes there is a large amount of scrap in western Canada that needs to find new outlets since the Canadian mills are not running at capacity.

Another source said the pattern the industry in the last two to three years is a result of several changes that have occurred over the last several decades. Among them: Technology has advanced, information is widely available in real time, and the role of the Covid pandemic.

But the biggest factor has been the steelmakers’ acquisition of a significant portion of the scrap industry. The mill-owned brokers now have tremendous leverage over the market, something they didn’t have before. “There is not much anyone can do about it,” he said.

The one thing that could disrupt this price malaise is the recent increase in Section 232 tariffs on imported steel from 25% to 50%. US mills announced hefty price increases on long products such as rebar following the news about higher tariffs. The other big question: Will tariffs result in increased domestic steel production and higher demand for scrap?

SMU asked this question to a mill buyer at a long products steelmaker. He responded, “It absolutely could. Especially if primes get tight with automotive maintenance outages. We may see that pull up the entire market. It will depend upon mill demand.”

As we go through the summer months, we will have to see how tariff-related activities affect steel production and hence demand for scrap. Perhaps it will break the downward/flat cycle the market has been in of late.

Stephen Miller

Stephen Miller started his career in the scrap metal industry in 1978 at Luria Brothers in Cleveland. Over the last 40+ years, he has worked in all capacities in the trading business. He has had positions in both domestic and international scrap trading. In addition to scrap, Miller was at the forefront of the pig iron trade and established a pig iron distribution company under the name of Ferrosource, Inc. Most recently, Miller has concentrated on the scrap export market and regularly does consulting for several companies in the industry.