US scrap markets for the month of December are now called sideways to November, following recent late scrap settles, with some US steel scrap grades finishing mixed to higher on the month, market insiders told SteelOrbis this week.
Insiders said the fast approaching winter season in the US Northeast and upper Midwest could keep scrap prices in the US Ohio Valley steady to recent November settles, even as demand for finished steel from the US auto and manufacturing sectors remains unremarkable thus far in the 4th quarter. Insiders said the possibility for snowfall and colder weather in the near term could further limit already scant new yard inflows, despite limited reports of higher collection prices being paid as a way to increase lagging inventories.
“I don’t think the market is going to go up for December if the order books for the new month stay the way they are,” said one Midwest scrap broker. “As a result, December scrap is looking sideways right now.”
“We’re expecting the first snowfall could come later this week,” remarked another scrap insider, also calling the market sideways for December. “Right now, the scrap market is so bad, that it will take very little to push prices up. All it’s going to take is one good snow storm and we could see scrap prices really rally.”
In the Ohio Valley, with the December market seen sideways, November shredded scrap on a delivered to customer basis was settled $13/gt higher versus October settles at $385-390/gt ($391-396/mt), while busheling grades were noted $18/gt higher on a delivered to customer basis at $390-415/gt ($396-421/mt) versus previous October settles. P&S grades settled up $10/gt to $375-385/gt ($381-391/mt) versus October customer-delivered pricing, while HMS I/II 80:20 grades settled sideways to October at $340/gt ($345/mt) delivered to customer on limited Midwest demand requirements for heavy melt steel.
In the export markets, New York dock prices for US East Coast HMS I/II 80:20 grades delivered from local export yards are noted at $290-310/gt ($296-315/mt), up from earlier SteelOrbis assessments at $275-280/gt ($281-286/mt), scrap insiders told SteelOrbis.
In the US Northeast, reports of declining overseas scrap pricing is making US scrap less attractive on an export basis, with some insiders hinting that pricing is likely to be at best sideways to potentially a bit lower in December as Chinese billet prices once again become a competitive substitute for what many perceive to be “high priced” US scrap.
While it remains a bit early to assess December scrap markets on the US East Coast, November settles were mixed, with East Coast shredded grades settled on a delivered to customer basis at $375/gt ($381/mt), about $20/gt less than October, while busheling grades were noted delivered to customer at $400-$410/gt ($406-$416/mt), up $17/gt from October. HMS I/II 80:20 scrap settled an average $340/gt ($345/mt) delivered to customer, up an average $10/gt from a revised $330/gt ($335/mt) October settle, while P&S was settled $5/gt less on a delivered to customer basis at $340-350/gt ($345-355/mt), market insiders told SteelOrbis.