April Scrap Prices Forecast to Move Higher – Steel Prices to Follow?

Early indications are for April ferrous scrap prices in the Midwest to rise once we enter the next round of steel mill negotiations with their scrap suppliers. Steel Market Update (SMU) scrap sources are pegging the potential increase at $10 to $15 per gross ton. Other industry sources have it as moving even higher.

Scrap Guru Mike Marley of Metal Prices penned an article to his customers late last week pointing to low inventories at many steel mills as potentially being one culprit which raises prices from here. “Nobody is mentioning the dreaded ‘s’ word (shortage) yet, but several dealers said they are feeling the pressure. Some mills may be down to only a week or less of inventory of obsolete material like heavy milt, and they want assurances that needed supplies will arrive soon. Buyers and brokers often call dealers and ask for the delivery dates on scrap orders, but that is usually in the last week of the month when mill inventories have dwindled. Receiving calls this early is an indication that some may be desperate for scrap.”