April Ferrous Scrap Prices: No Dramatic Shifts in Pricing Seen

Here is what we heard from one of our pig iron sources this morning, “The offers from little tonnage is still made in Northern Brazil are at about $380 – $385/mt CFR NOLA.  The Ukraine production has been interrupted so the Russian pig iron offers probably are $385 – 390/mt CFR.” 

As long as the price of prime ferrous scrap stays strong so will pig iron.  It won’t slip with a scrap decline of $10-20, it would have to a longer steady decline.  The Brazilians are probably sold out until June/July shipment. 

Demand has been good at the domestic steel mills as witnessed with the better capacity utilization rates we have seen out of the AISI over the past couple of weeks.

One of our sources off the east coast had this to say about April scrap price expectations:

“It’s too early to peg where the April market will trade exactly.  Demand is good, even better than last month, as evidenced by the improved operating rate, some bigger mill buy programs, and continued prime scrap tightness (DRI at Nucor is available again though pig iron is not) will keep prices somewhat steady.  Deliveries to mills, especially from eastern yards, have been weak in March due to a lack of available railcars.  But it will also be typical April market which means that dealers will not want to be holding much scrap at the end of April and better flows are probably coming soon (though not as good this year as is years past due to generally good weather this winter).  In any event, I expect prime to trade sideways for the most part (no more $400++ deals though), and obsoletes to trade marginally weaker.”