April ferrous scrap prices could trend lower

Mar 14, 2013 | 03:42 PM | Sean Davidson

Tags  ferrous scrap, scrap prices, scrap exports, scrap imports, Sean Davidson

NEW YORK — It has been only a week since ferrous scrap prices in the benchmark Chicago area settled for March, but some market participants are already making forecasts for April: a sideways to slightly down pricing environment, depending on the region, following this month’s double-digit bounce.

Scrap metal deliveries completed by the last week of March will be the real gauge of next month’s scrap prices, several market sources said, with most dealers agreeing it is still too premature to discuss April’s market, let alone dub it weak.

But some market players are nonetheless eyeing other external factors as they attempt to forecast the market’s next move.

A week after scrap markets across the United States recorded monthly increases of anywhere between $15 and $45 per gross ton, depending on location and grade, a few scrap buyers said they have continued to receive offers on shredded and prime scrap at prices below March settlements, leading them to speculate that prices could dip in April.

Minimal export activity off the West Coast and a sideways trend on export prices to Turkey this week lent further support to early speculation that domestic prices could soften, sources said.

A buyer for one domestic steel producer said April’s market in the South for primary scrap like No. 1 busheling will be further impacted by the arrival of two bulk vessels from Europe this month.....