NEW YORK After setting domestic markets on fire with significantly higher bids for prime scrap before the month started, most steel mills in Ohio and western Pennsylvania completed their monthly buys July 8 at increases that matched the early, aggressive push by one steel producer.
According to market participants, mills in Cleveland concluded their No. 1 busheling buys for July at an increase of $45 per gross ton from June, with the most sought-after grade delivering the highest increase.
As a result, AMMs assessment for No. 1 busheling in Cleveland settled July 8 at $430 per ton, up $45 from June. Meanwhile, most obsolete grades and shredded scrap settled up $25, with No. 1 heavy melt settling at $355 a ton and shred at $395 a ton.
The big push for prime grades in Ohio and western Pennsylvaniainitially led by one steel mill rumored to have been short material (amm.com, June 26)forced mills in other markets to also offer stronger prices for prime scrap, and although Pittsburgh has yet to settle, sources said prices there also appear to be leaning toward up $25 for cut grades and up between $45 and $50 a ton on prime material.
Pittsburgh was slower to settle than other markets in the region as mill buyers cautiously waited to jump in or held out in hopes that the market had hit its peak, sources suggested.
"The market may have peaked but it is not sliding down," a Pittsburgh mill buyer said.
In the Midwest, mills in the St. Louis region also decided to wait until July 8 to conclude their buying despite Chicago and Detroit settling early (amm.com, July 3).
Market participants said most mills in St. Louis tied up volumes before the Independence Day holiday on the condition that prices would be negotiated this week.
By the middle of the trading day on July 8, price negotiations mirrored the Chicago market and delivered a $20-per-ton increase on most obsolete grades and a $30-per-ton bump on primes, sources said.
Mill buyers who had hoped that market would cool off after last weeks early trading were greeted July 8 by dealers who refused to budge, sources said.
"The perception is that August will not be any lower; therefore, mills were not able to talk prices down. I still anticipate prime to be a little tight in August due to (auto) plant summer shutdowns," one St. Louis dealer said.
"Suppliers thought this could be a month to push for even higher prices but then they realized the market was not on fire. So there wasnt really much resistance to the $20 to $30 increases in St. Louis," he said.
A second source in the region agreed.
"It seems on par with the supply shortage and what I thought would happen when June ticked down. So it was relatively predictable that it would rubber-band back a bit higher than what it went down in June," he said.
In the Southeast, deals were slow as one producer is still pushing to trade at prices unchanged from June. In Birmingham, Ala., and the Carolinas, sources said the market looks poised to settle at up $30 on prime and up $20 on all other grades.
Lisa Gordon, Pittsburgh, contributed to this story.