FULL OF SCRAP Misery in herky-jerky motion

Jul 01, 2007 | 11:05 AM |

Ferrous scrap has always had unpredictable pricing patterns—up $2 per ton one month followed by a $5-per-ton increase the next and then down $5 the following month.

Years ago, a $10 or $12 move was a dramatic change. All of that seemed to end in 2004, when the automakers' factory bundles built a new Everest at more than $450 per ton and dragged along the others—not up to the peak of $400-plus a ton, but to the $200- and $300-per-ton level.

Since then, an unusual price phenomenon has occurred almost every year. Ferrous prices climb to a peak of, say, $350 per ton, but then spend the next five or six months tumbling. The steepest such plunge came in late 2004 and early 2005, when the auto bundle numbers rose to $442.50 per ton in November 2004 but were down to $155 by the following June. A year later they scaled the mountain again, reaching $366 per ton in July 2006 before plunging to $210 by November. And after climbing to $352....