Analysis
December 2, 2025
Scrap market sees early settlement signs in short holiday month
Written by Stephen Miller
There has been debate about the direction of the US scrap market for December. Some market participants believe some grades can increase in price, especially secondary grades. There were no market players who believed prices could go down.
The market is still supply-driven, said a steel executive in the Central US. With winter weather already here, obsolete grades could see a tick upward, he explained. If these prices rise more than $20 per gross ton (gt), busheling could also rise to keep some spread over shredded. Noting December is another short shipping month, he predicted early settlements.
Well, today, this prediction proved essentially correct. A steelmaker in the Southeast has entered the market for shredded, P&S, and HMS at prices of $20/gt over November. Other mills and mill-owned brokers are signaling they will match these increases, although they have not officially priced their offers. The mill, which has led off December buying, does not buy very much prime material. So, busheling prices are still up in the air. SMU spoke to a scrap executive in the South, who expressed surprise at the elevated price for obsolescent scrap. He now thinks busheling will also have to rise to keep the proper spread between the grades. He also added that buying may drag out longer than initially expected.
Recall that last month, our sources reported mills in the Chicago/Detroit districts were seeking more shredded at prices $20/gt above the November settlement prices. SMU wasn’t able to confirm this at the time.
A large Midwest steelmaker issued cancellations for all undelivered scrap orders except shredded orders before the holiday break, according to a scrap supplier in Chicago. Usually, order cancellations portend an imminent price drop. However, since there is no sentiment about a falling market, this suggests some mills may have enough scrap on hand to carry them through December, except for shredded. Either that or they have enough on order after entering the aftermarket at the +$20/gt price we heard last month. The trade is about to find out.
A source to the East told SMU most of the dealers he has contacted don’t expect to sell or deliver very much in the short month of December. An additional source in this same region mentioned dealers will sell sparingly if prices rise $10-20/gt. Most will wait for the inevitable larger rise in January. If HRC activity is strengthening at that time, prices can continue to rise through the winter, the source said.
