Ferrous Scrap Prices Drop Another $30 Per Ton

Ferrous scrap prices for June have settled down another $30/GT, surprising a market that was expecting little or no decline this month and adding further pressure to already weak finished steel prices. Scrap prices have been on a downward trajectory since January.

The drop in scrap prices this month was caused by low mill demand amid high inventory levels and weak order books for many finished steel products, said Ryan McKinley, CRU North America analyst. The export market, while it rose, was not enough to offset the abundance of scrap in the U.S. relative to demand. “I also do not see much of an upside for July,” McKinley added, “but the construction sector is solid, and many expect that to help demand for long products. In theory, this could help stabilize or boost obsolete prices.”