Ferrous scrap mart enters 'summer doldrums'

They don’t seem to think prices will go up or down, he said.

Looking to the South, it is a similar situation. Demand is brisk among the mills in the region, but supply looks adequate.

The two new recent entrants into this regional market, namely Hybar and AM Calvert, will not be buying in July as they ramp up their facilities.

The level of export activity does not seem to be hurting domestic supply. Rather, it may be adding to it. 

The consensus is for a “strong sideways,” according to one of our sources there.

SMU contacted a purchasing executive in the North Central region to get a consumer’s view of things.

He indicated that the summer heat and industrial plant shutdowns are reducing the flow of both obsolescent and industrial scrap.

However, he noted that, “Overall supply is at equilibrium with demand. Demand is not strong enough to drive the market up, but not weak enough to leave tons overhanging, which would drive the market down.”

That statement seems to sum things pretty succinctly.

Most of our sources are looking ahead to August for any possible upward movement in the scrap market.

The hope is the increased tariffs on steel will stimulate domestic steelmaking to the point where scrap demand will benefit.

The previous mill source also added that he sees a sideways pattern lasting through July, “with some uptick coming in August as HRC mills get a touch busier. Tariffs seem to be working to our (the mills’) advantage!”

According to our various sources, it is unlikely there will be any official scrap settlements before the July 4th holiday weekend. Dealers will continue to ship scrap on a “price-to-determined basis” in the meantime.