Domestic scrapyards are opting to export heavy melt rather than risk rejection of a shipment by more demanding U.S. mills

Jul 01, 2010 | 09:49 AM | Michael Marley

Domestic scrapyards, facing increasingly strict requirements by U.S. steel mills, are instead opting to feed the insatiable appetite of offshore steelmakers, a move that is changing the recipe of the scrap mix.

Scrap dealers have little or no problems with the heavier cut ferrous scrap grades like 5-foot plate and structural scrap, but the same can't be said for No. 1 heavy melting steel. The main problem lies in the specifications for the heavy melt, which can vary from mill to mill, one western Pennsylvania dealer said.

"Heavy melt is what's left over if you can't bale it or turn it into a structural," he said. "Everything that doesn't qualify as a better grade goes into heavy melt—shafts, gears, sealed units. If it is old, then it's going into the heavy melt. If it is new steel, it often can be sheared or baled and sold as No. 1 busheling or a No. 1 bundle."

In the past, integrated mills never bought heavy melt for their basic oxygen furnaces. Now, both integrated steelmakers and the electric furnace (EF) melt shops are using computer programs that recommend what to buy. These programs weigh the prices and availability of various grades in a region and suggest the cheapest scrap mix to buy for the type of steel products the mill plans to produce that month.....