February scrap prices appear poised for fall

Feb 04, 2013 | 03:59 PM | Lisa Gordon

Tags  scrap prices, Chicago, mill buyer, metal recycler, shredded scrap, prime scrap, heavy melting scrap, Lisa Gordon

PITTSBURGH — An ample supply of raw material, mediocre mill demand and bearish mill buyers could lead to a drop in scrap prices for February, according to scrap brokers, processors and mill buyers.

Brokers at mill-owned scrap assets are sending mixed signals to their customers. “We’ve received some January order cancellations and some have been left open. Yards don’t have large inventories and mill demand remains constant,” a seller into the Midwest said.

In Chicago, numerous integrated and electric-arc furnace (EF) mills have executed their right to “end-of-month cancellation rights”—a clear sign the market will retreat, sources said.
“We saw cancellations from mills across the board, which is pointing the market (downward), but it does appear to be a soft sideways,” said a Chicago broker. “The talk is the mills will come out and try for down $20 (per gross ton) but will settle at better prices if there is resistance and enough of us choose to hold our tons.” ....