Ferrous scrap prices said set to drop again

Apr 25, 2013 | 05:18 PM | Sean Davidson

Tags  scrap, ferrous scrap, steel scrap, scrap exports, Sean Davidson

NEW YORK — A struggling ferrous scrap export market and weakness in several finished steel product segments have led many to speculate that the domestic scrap market will be weaker in May.

In an informal survey this week, nearly half the market participants contacted by AMM said they expect scrap prices could drop by between $15 and $20 per gross ton next month, with about one quarter saying they could drop even further and the remainder undecided on their May outlook.

An equal number of mill buyers and scrap suppliers said they expect monthly prices are poised to soften by $15 to $20 per ton next month, with even some sellers and brokers suggesting that prices for some grades could fall by as much as $25 per ton from April levels, which were down about $20 from March prices.

In Detroit, at least one steel mill reportedly has already concluded some deals for obsolete grades of scrap at down $20, but a majority of buyers and sellers said they had not heard of or concluded any recent transactions.

Many market participants in Illinois and Indiana said they are still uncertain on price direction due to logistics issues caused by recent river flooding (amm.com, April 23). Some sources suggested that transportation issues along the Illinois and Mississippi rivers could have a negative impact on scrap flows and offer some support to May tags, while others speculated that the impact would be minimal.....

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