March Scrap Negotiations May Take Awhile

After negotiations were completed for February scrap pricing, the word being spread around the industry was to expect another drop in March, perhaps down $20 on most grades. However, the weather got brutal during the month and we are hearing that many dealers will not be able to complete deliveries on obsolete grades of ferrous scrap such as heavy melt (HMS) and shredded scrap. Flows  of prime grades (Busheling & bundles) are plentiful as the automotive stampers continue to spit out new car parts.

Mike Marley, scrap guru for MetalPrices.com told his readers on Friday, “The one-two punch of price cuts and winter weather have dropped shredded and obsolete scrap supply to the canvas. Dealers throughout in the upper Midwest and Middle Atlantic regions said the intake of these secondary scrap grades is off by as much as 50% from the modest levels they had anticipated for the midwinter. That has left many without enough scrap to fill the orders they took earlier this month. Supplies of No. 1 busheling and bundles are still plentiful. However, dealers avoid talking about that material and its likely impact on the demand and prices. Tight supplies of shredded and heavy melt are the loudest lines to their March chorus.”