Marley: Several Factors Reshaping the Scrap Market

Stronger domestic demand for steel products, combined with feedstock and transportation problems, sent ferrous scrap prices on divergent paths in various parts of the country this month, reports scrap guru Mike Marley of World Steel Exchange Marketing. Tight supplies of key obsolete grades produced pricing moves ranging from unchanged for industrial steel grades in several northern steelmaking cities to increases of as much as $50 per gross ton in the South.

Prices hikes of up to $20 per ton on shredded and cut grades were the first moves and the prevailing trend in some regions of the North, while the offers for busheling and bundles were sideways. But some dealers and traders in Chicago and other nearby regions held out and managed to push for increases of as much as $30 per ton for cut grades like No. 1 heavy melt and five-foot plate and structural scrap, a $20 per-ton hike for shredded scrap and even a modest rise of $10 per ton for busheling and bundles prices. In the South, however, some mills played catch-up and paid bigger increases. Shredded scrap prices rose by $30-35 per ton, heavy melt and five-foot plate and structural were up by $25-30 per ton and prime industrial grades like busheling rose by $10-15 per ton, Marley reported.