Ferrous Scrap Prices Expected to Move Lower Again in August

Ferrous scrap prices are likely to trade flat to down a further $20 per ton in August, following on a $20-40 drop in July, lending little support to the mills’ hopes to raise finished steel prices as the economy slowly recovers from the pandemic.

CRU Senior Analyst Ryan McKinley said stronger demand for scrap exports may help keep prices stable for obsolete grades, but prices for prime grades almost certainly will move lower as supplies grow amid renewed generation by automakers and other manufacturers. He predicts obsolete prices will be sideways to down $10, while primes will decline by $10-20 in August. “Whether or not obsolete grade prices fall next month depends on how much of that material is pushed to the East Coast for export and how much inbound flows have been affected by a decrease in scale prices. Demand for scrap has not weakened overall month over month, but there is a chance that supply outpaces demand and prices come off a bit in August,” he added.