Scrap to Move Higher in June; Chinese Buying Up Pig Iron

Ferrous scrap remains in limited supply, prompting predictions that scrap prices will settle still higher in June, on top of the big increase in May. Steel Market Update sources forecast an increase of $10-20 per ton for obsolete grades and $20-30 per ton for prime grades in June from May levels. Higher scrap prices may lend support to the higher finished steel prices announced by the mills this month.

In May, ferrous scrap prices settled up $30 per ton for shred and up $40-50 per ton for busheling as coronavirus shutdowns disrupted scrap generation and collection. While demand is expected to improve next month as government restrictions ease and more manufacturers reopen, scrap supplies are likely to remain tight for a while.