For the January buy-cycle, US domestic scrap prices increased $25-45/mt depending on grade and region. Early on, dealers were holding off committing inventory which allowed for several deals on the upper end of the range in the Midwest, but exporters began to make their shredded inventory available inland given the lack of export demand. This dampened the increase toward the end of the buy-cycle.
For February, the opinions from sources close to SteelOrbis range from same to soft sideways to even a possible retreat of up to $10-20/mt.
Those that express the opinion that prices will remain the same to slightly soft believe the tight supply caused by slightly lower prices to collectors’ and the production limitations at yards due to cold weather condition will buoy prices. Additionally, they are optimistic of additional demand from domestic mills.
Those that express concern of a possible price retreat in February, call upon the following factors:
• Export demand may not rebound given the height of US scrap prices, Turkey finding scrap cheaper in EU/Baltics, and the strong dollar.
• Exporters may offer more scrap inland in February (due to slow bulk and containerized demand)
• Some imported scrap is rumored to be slated for delivery in February
• Flow into yards may not be dampened due to recent slight downward price adjustment to collector’s as it was against a previous $30/mt increase. Collector’s may still find the pricing attractive against the expectation of even lower prices the following month.
• Domestic mills, while showing optimism, may wait until March to increase inventories