Shredded scrap exports sink as freight costs soar

Nov 15, 2007 | 06:42 AM | Michael Marley

Higher ocean freight rates and fewer ships to carry their cargoes cut U.S. shredded scrap exporters' shipments in September almost 20 percent from the prior month's tonnage.

Exports of the material sank to 342,802 tonnes during the month, down more than 80,000 tonnes from the 425,233 tonnes shipped the previous month, according to the latest figures from the U.S. Commerce Department. The steepest declines were seen in the tonnages delivered to steelmakers in Turkey, Egypt and Greece.

Freight costs have climbed to as much as $75 a tonne for ships leaving the U.S. East Coast destined for the eastern Mediterranean, one East Coast exporter said. More troubling, though, is the shortage of ships to carry scrap, he added. Rising demand for coal and iron ore in the Far East has deprived both East and West Coast scrap shippers of vessels. Freight costs from the West Coast to northern Asia have risen to $100 a tonne or higher, while bulk cargo costs to southeast and southern Asia have soared to $115....