Final Thoughts

Since 2023, scrap prices have risen significantly in the months of December and January. February could go either way depending upon certain things, like weather or increased demand. But usually by March prices begin to ease off considerably. And by May the market trades relatively “soft” sideways until November when supply tightens after scrap flows started to decrease due the extended price declines, or stagnation over the summer and into the fall.

When this happens, the scrap buyers see that there is one last chance to squeeze the last dollars out of the market by continuing to drop prices, despite resistance from the dealer sector. 

This is what happened in the 2025 October market. The inexplicable dearth in demand for the prime grades of #1 busheling and bales in the face of falling industrial activity is tied to pedestrian sales of hot-rolled coil (HRC) in the EAF steelmaking community. Even with new capacity now coming into the market, like AM Calvert, the price of busheling fell in October. So much for the “precious metal” moniker, at least for now!

But this is not the case for the obsolescent grades of shredded and HMS. As buy week kept getting extended, the larger non-mill owned processors objected to any drop in shredded and HMS price tags. They threw their hands up on busheling, but were not going to sell at down a hard $20 on these grades.

A quick look over to the docks gave them a view of increasing export prices. Nevertheless, the mills proceeded with force-feeding dealers to accept a $10 drop in shredded. HMS held sideways for the most part until a few determined mills managed to fill in at down $10.

So, I would surmise from all this, the market has bottomed as it has for the last several years around this time.  What happens from here?

A steel mill purchasing executive told me he expects November to be no worse than sideways and in December expect a slight uptick. I don’t see that happening necessarily. Mills still need scrap to flow despite their concerns about inventory levels as their accounting year end. If the November market trades “strong” sideways or up, the December increase will be more than an uptick.

The same source mentioned steelmakers are counting on a better start to 2026 and expect more activity.  If this increases demand for scrap over and above weather and accounting influences, all hell will break loose in January. This has happened before. When a market has traded sideways for so long and then prices drop further right before winter and the holidays, prices are going to rise. It’s just by how much.

In 2023-24 and 2024-25, scrap prices rose an average of $90-100 per gross ton (gt) over the winter before falling back in the spring.

I spoke last year to a purchasing manager at a Midwestern steelmaker and asked him about this type of possibility. He said HRC won’t go up by that amount. Well, it didn’t until the tariffs were increased to 50%, but scrap sure did.  

It just seems like there should be a better way to do this.  Steelmakers over the last three decades have acquired significant scrap recycling and trading assets. So, they have much more influence on prices than in the past. Maybe, it would be more strategic to use this new power to keep scrap flowing evenly and avoid the wild upswings in the winter months. I don’t know for sure. However, if you keep doing the same thing and expect different results, you know what they say…