Scrap Dealers Holding Back as Market May be Stronger than +$50

Supply of ferrous scrap continues to be an issue for the domestic steel mills. On Friday of this past week scrap prices settled in the Detroit market up $50 per gross ton. However, many of our scrap sources are advising that the rest of the country is in limbo as many dealers think the market is stronger than up $50.

Earlier today (Sunday) we heard from one of the key scrap companies out of the Chicago area who told us, “In most parts of the country dealers are afraid to price in fear that market is stronger than 50. Mills are waiting for offers but getting nothing as of today.” When asked if they would hold-back scrap in April assuming May prices would be higher we were told, “I would not hold anything in an up 50 market. I think there is not a lot of stock in dealer yards.  A lot of TBD [to be determined] happening but not enough for mill comfort. Even with higher pricing I think we are still in a fragile market that could turn the other way in a second but many think we have a 60 day window.”