Scrap market unsettled as suppliers fight drop

Feb 05, 2013 | 05:36 PM | Sean Davidson

Tags  ferrous scrap, scrap prices, sean davidson

ISTANBUL — Dealer resistance in the Midwest to sharp downward movements on ferrous scrap pricing for February has prolonged trading in the region as buyers and sellers continue to negotiate a middle ground.

The early entry of a Chicago mill at down $10 per gross ton on all grades compared with January prices initially brought hope to some suppliers who had anticipated a weaker market of as much as down $20 per ton or more this month. But other sources said the mill had bid at stronger-than-expected numbers late in the day Feb. 4 to cover a short position on certain grades of obsolete scrap, including plate and structural and heavy melting scrap, and did not appear to be indicative of the region’s overall trend.

"Down $10 is the best price yet," said one seller in Chicago, who noted that mills were "slow coming out" but appeared to be finishing up their February buys by the end of the day Feb. 5.

A second source agreed that the Chicago mill’s unexpected $10-per-ton drop was not characteristic of the overall market, noting that "they were a bit cheaper than a lot of the market last month and they need those grades. Heavy melt is tight for sure."....