Steel scrap tags poised for severe fall: market

Jul 05, 2012 | 04:45 PM | Sean Davidson

Tags  ferrous scrap, scrap prices, Sean Davidson

NEW YORK — Domestic ferrous scrap markets appeared to be staring at another month of significant price drops as steel mills sent out early feelers across the country on Thursday.

Market participants said a number of mills in different regions have indicated a month of reduced buying programs of varying degrees, which has put obsolete and prime grades under severe downward pressure.

Midwest suppliers said buyers at some mills were testing drops of $40 and $50 per gross ton on prime grades in early conversations, although very little tonnage had actually traded by Thursday afternoon, making it hard for the market to determine true price levels for July.

The Midwest regions of Chicago, Detroit and St. Louis are likely to settle sometime between late Friday afternoon and Monday, sources said, noting that early indications are certainly to the downside.

"The market’s dropping pretty significantly again. Mills are taking their time since they have reduced programs. Some mills are saying they think the market’s down $40 or $50 across the board," said one trader.....