Early scrap deals in Alabama are being done at
a discount to September, but its too early to tell if
this is where prices will settle.
One mill buyer has
been successful in picking up busheling, No. 1 heavy melt and
plate and structural steel scrap from domestic suppliers
at down $5 to $10 per ton, and the mill also has booked a cargo
of prime scrap from Sweden at an estimated price of $418.50 per
tonne delivered to its facility.
No shredded scrap
deals were transacted at a discount to September as the region
is not experiencing the overhang of shred that is prevalent in
northern cities, sources said.
A few early
deals dont make a market, but October could be down a
little, a mill supplier source said. A mill-owned
broker has suggested this will be the last movement down and
then it will be sideways to the end of the year.
Sources said that for
the most part all but three mills in the region appear to be
gearing up for a full buy in October. One mill is taking a
one-week outage, a long products mill is running poorly due to
a weak order book and a third mill has decent scrap inventory
because it bought heavily in August and September.
Long product mills
continue to lack business but sheet mills are running at a
steady pace, according to several supplier sources. I
think we are close to a bottom because (sheet) mills are coming
back to us and wanting extra scrap, the shredder source
According to sources,
inventories at scrapyards are decent but not robust, and if
Alabama does throttle down in October it may be due to other
regions. The mills know that other areas look as if they
will be down $10 a ton and they will use the down across
the country excuse as a playing card, said an
exporter who buys in the area.
Some scrapyards said
they would rather sit out the market than take another haircut.
We have reached a point where we are willing to sit back
for the rest of the year and sell up in January. Some guys held
back in September for the same reason, another mill
supplier source said.