US scrap prices for July settled sideways to down in the US Ohio Valley on low finished steel prices, and sideways to higher in the East amid strong export demand and amid reports of reduced inventories at scrapyards, market insiders told SteelOrbis this week.
In the Ohio Valley, market insiders said continued low demand for finished steel goods such as appliances and automobiles has resulted in increased scrap inventories at steel mills, prompting producers to offer lower scrap prices across the board.
As forecast by market insiders, Midwest busheling prime grade scrap lost the most versus other grades on the heels of continued soft hot rolled coil values, declining $20/gt ($20/mt) on a delivered to mill basis to $355-375/gt ($361-381/mt), while HMS#1, which has a more limited application locally, lost the least, settling flat to June at $320/gt ($325/mt) delivered, scrap market insiders said. P&S scrap and shredded grades settled sideways to $10/gt ($10/mt) less at $345-355/gt ($351-361/mt), and $370-380/gt ($376-386/mt) delivered to mill respectively, scrap market insiders told SteelOrbis. The further west you got from the East Coast, they said, the lower the scrap values settled as limited finished steel requirements dominated most purchases.
On July 8, US steel maker Nucor announced its weekly Consumer Spot Price -the price it charges for hot-rolled coils at all of its producing mills- would remain unchanged for a second week at $670/st ($739/mt) FOB mill, the steel makers said in a letter to all of its customers. Since releasing the CSP index in early April, Nucor’s HRC prices have declined more than 19.3 percent as demand for finished steel goods remains muted amid high interest rates, soaring year-over-year inflation statistics, high energy prices, and a looming US presidential election in November.
On the US East Coast, market insiders noted scrap inventories estimated to be 20-30 percent below normal buoyed July scrap values on a delivered to mill basis from $15/gt ($15/mt) to as much as $50/gt ($51/mt) for Pittsburgh busheling grades. They added that strong export demand, and tight international scrap markets were helping to boost July scrap values versus June. Perceived market strength in the East continued through the July buy cycle mostly on exports, despite shortened mill buying programs as local demand remained weak, insiders said.
Busheling scrap in the vicinity of Pittsburgh settled up the most at $350-385/gt ($356-391/mt) delivered to mill, while shredded scrap was flat to June at $370/gt ($376/mt) delivered to mill. P&S grades settled flat to $20/gt higher at $320-340/gt ($325-345/mt), while HMS#I settled flat to up $25/gt at $290-315/gt ($295-320/mt) delivered to mill.