Higher Scrap Prices Expected in October

Following on a big jump in ferrous scrap in September, scrap prices are expected to move higher for obsolete grades and sideways or higher for prime grades in October, lending further support to rising finished steel prices.

“Domestic steel capacity utilization and prices are rising, but the large price increase last month has not resulted in dramatically higher inbound flows to dealers’ yards,” reported CRU Senior Analyst Ryan McKinley. “We’re still expecting higher prices for obsolete grades domestically, probably an increase of $10-20 /l.ton m/m. However, prime grade flows are stable, and I see little upside for those prices especially when considering that pig iron prices are falling internationally as Chinese demand wanes.”