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US stainless scrap divided on exports

Keywords: Tags  stainless scrap exports, stainless scrap imports, scrap exports, stainless scrap prices, Hunter Alloys, Barry Hunter, Outokumpu Oyj, ELG Metals Alasdair Gledhill

NEW YORK — Stainless scrap industry leaders appear divided as to whether the United States will become a net importer or remain a net exporter over the coming years.

The discussion kicked off at AMM’s 27th Annual Stainless and its Alloys Conference in Chicago this week after Boonton, N.J.-based Hunter Alloys LLC president Barry Hunter cast doubt over the accuracy of the federal government’s stainless scrap export figures.

The ramp-up of Espoo, Finland-based Outokumpu Oyj’s mill in Calvert, Ala., is going to alter the import/export dynamic as domestic producers chase more nickel-bearing scrap, McKeesport, Pa.-based ELG Metals Inc. nickel product manager Alasdair Gledhill said.

"That’s going to radically change the scrap flow in North America. We can argue about the specific levels of export, but that’ll change. And it will change quite rapidly to (a situation) where scrap from the West Coast and East Coast will find its way into the Midwest to be melted by the large stainless consumers," he said.

However, Aliquippa, Pa.-based Cronimet Corp. president and chief executive officer Frank Santoro expressed doubt that domestic stainless mills would consistently run at a rate to necessitate a reversal in the import/export balance.

"We’re of the opinion that if everything ran at 2006 production levels forever, we’d be a net importer. But in a 10-year cycle, how many years are stainless mills running at 100 percent? So, on a consistent basis, will there be a net importing of scrap? I’m not so sure about that," he said.

Gledhill noted that scrap processors had been challenged recently by declining nickel prices on the London Metal Exchange, which has led to "sporadic disruptions in the scrap supply chain."

"When the price falls rapidly and consistently, dealers tend to pile their scrap up and wait for a better market. It’s up to our industry to smooth that supply chain," he said.

Processor buying prices for Type 304 solids had fallen to a range of $1,175 to $1,230 per gross ton July 8 from $1,745 to $1,810 per ton Jan. 22. The current range is $1,320 to $1,365 per gross ton, according to AMM’s most recent assessment.

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