Ferrous scrap in tailspin, prices fall $50/ton
Nov 04, 2011 | 04:28 PM
| Michael Marley
PHILADELPHIA Ferrous scrap prices have plunged as much as $50 per long ton amid a flood of cheaper pig iron from Brazil and weaker export buying prices, the first time in more than six months that prices have moved so dramatically.
Prior to this, much of the second half had seen prices see-saw in the area of $5 to $15 per ton, a steady or near sideways pace uncharacteristic of the ferrous scrap market.
No. 1 heavy melting steel and shredded scrap tags have now sagged about $25 to $30 per ton in many major steelmaking markets, while prime industrial grades like No. 1 dealer bundles and No. 1 busheling were hardest-hit, plunging by $50 per ton in major Midwest cities like Chicago and Detroit.
Dealers and brokers attribute the fall to a stronger flow of prime scrap from automakers and other manufacturers. Add to that a deluge of cheaper Brazilian pig iron. Much of that material was bought months ago by U.S. brokers on speculation that the market would go higher and is now sitting on the ground at river ports. The excess has given some mills more leverage in their buying this month, helping them force prime scrap tags down more than some expected.....
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