Last week, SteelOrbis sources throughout the US said they believed that April scrap prices would trend sideways to up $10-$20/gt. This week, all sources polled say they continue to be in that same camp.
“I think April will be more of a breather than anything else. The [East coast] exporters just dropped their [dock] prices by $10/gt which to me, signals they’re getting a decent flow at these levels,” said a source in the Northeast. “As for the local yards, scrap flow also seems to be good there and there doesn’t seem to be any pending freeze coming that would stop scrap from flowing. You also have to remember that just because mills are raising [finished steel] prices that doesn’t mean they’re going to be rushing out to pay more for scrap. I could make a really good case for sideways.”
Sources in other regions said they too, believe that sideways pricing is likely.
“It seems like all of the mills are getting as much scrap as they need,” added a Chicago-based source. “I don’t expect the market to be up.”
Others, on the other hand, feel that they could make a case for slightly strong prices in April.
“I think primes could come up $20-$40/gt and other grades maybe up $20/gt,” said a source in the Southeast. “Turkey has plateaued and I don’t see enough scarcity on obsolete grades to see another huge increase.”
A Florida-based source said he too, believes that busheling will be up, and that shredded scrap will trend “flat to up.”
“I think [April] is a tossup,” a final source added. “Inflows [in the Midwest are] very slow and if, and it’s a big if, the mills have normal ‘spring ramp up’ [and decide to build their scrap inventories] they will need to pay up a bit. There are already some mills reaching out to see if they can secure tons so that is a good sign!! My guess is sideways to up $20/gt but who knows these days!”
The April buy cycle is expected to start within approximately 10 days.