Mexican domestic scrap prices have moved down through September. For most of the summer, Mexican scrap domestic prices remained disconnected from the global and US scrap markets which moved downward since mid-May. Domestic mills tried with little effect to lower prices 200 pesos on a weekly basis but failed due to tight local supply. Scrap firms were actively bringing in scrap from the Baja California area and the US to keep up with demand.
Initially, the devaluation of the peso and effective increase in the cost of scrap ex-US was expected to tighten supply and buoy domestic prices into late September, but with domestic US steel orders slow, decreased US HRC and CRC prices, exports to US less than expected, and US scrap prices expected to decline in October, domestic prices of finished goods have moved down drastically and now so has scrap. The lower scrap prices are additionally supported by the loss of demand due to planned maintenance outages at several regional mills in September and October.
In the Northern region of Mexico, HMS I scrap is at $3,750-3,950 pesos/mt ($195-$206/mt), shredded scrap is at $4,000-4,200 pesos/mt ($208-$219/mt), and busheling is in tandem with P&S at $4,300-4,600 pesos/mt ($224-$239/mt), all pricing referenced delivered to mill.
$1 = MXN 19.21