Search
AMM.com Copying and distributing are prohibited without permission of the publisher
Email a friend
  • To include more than one recipient, please separate each email address with a semi-colon ';', to a maximum of 5

  • By submitting this article to a friend we reserve the right to contact them regarding AMM subscriptions. Please ensure you have their consent before giving us their details.


Mart sees scrap prices holding steady in Aug.

Keywords: Tags  scrap, ferrous, Chicago, Midwest, busheling, heavy melt, HMS, Sean Davidson


NEW YORK — Domestic ferrous scrap prices could trend sideways in August as early speculation points to a market that is in relative balance.

An overwhelming majority of mill buyers and scrap suppliers believe August is poised for a sideways market, according to an informal survey conducted by AMM.

Only one-fifth of the respondents speculated that prices could dip slightly lower in August, while about 10 percent of respondents said prices could trend higher.

Market participants for the most part expect prices to remain unchanged next month, with decent scrap flows into dealer yards offset by better demand from mills and logistical issues in some regions.

"I expect demand in the Chicago area will increase in August. The scrap market is close to being in balance. However, the Chicago market traded weaker than surrounding areas, which should insulate Chicago from further drops," a Midwest dealer said. "August is likely a sideways market in Chicago, and for some this may equal a better price than received in July, depending on when their July trades occurred."

A second dealer expects delivery issues due to rail disruption caused by flooding to offset a healthy flow of scrap into processing yards, while a third dealer said recent anti-dumping tariffs and long mill lead times will help keep prices sideways despite improved scrap flows.

Some Midwest mill buyers said they anticipate prices will hold in August, echoing the majority supplier sentiment, although at least two buyers speculated that prices could weaken somewhat due to an apparent oversupply of No. 1 busheling.

However, a few dealers and brokers felt that prices could rise in August.

"August is firming as more mills are calling for shipment of scrap. They executed their buy too late and now some mills will have to pay more to expedite shipments," one supplier said. "The market is sideways if you evaluate all of the fundamentals, but mills took too long to buy and it is taking too long for scrap to arrive. My bias is switching from negative to positive as more mills call for shipment."

Buyers and sellers unsure of the price direction in August said the absence of any clear signs behind stronger or weaker prices was the sole basis of their "sideways" speculation.

"(I’m) really on the fence for August. I do not see much scrap heading to the docks unless the shippers are close to the coast," a Mid-Atlantic supplier said.

"Flows into the yards have been steady and we have not had an extended heat wave. It almost feels like the demand-supply ratio is in balance. I have heard some saying August will be down, others saying up $20 (per tonne). At this point, I think it is a roll of the dice. If I were to guess, I would think the market remains flat," he said. "In my view, a stable market for a few months is a good thing. It seems to bring some sense back into the buy side by taking the speculators back to reality."


Have your say
  • All comments are subject to editorial review.
    All fields are compulsory.



Latest Pricing Trends