A January 1 overnight fire at the BlueScope Recycling and Materials, a 350,000-400,000 ton per year scrap sorting facility in Mansfield, Ohio, will affect January shredded scrap deliveries and could potentially boost depressed US Midwest shredded scrap prices, though the company said today they will temporarily deliver scrap to “partners” able to remove impurities normally sorted out of the scrap stream at the downed plant to keep scrap flowing to the market.
The Wednesday night fire occurred in a sorting building that removes insulated copper wire and stainless steel from scrap prior to shredding, said Mark Hein, a company spokesman. The affected building has since been sealed off, Hein said, and other scrap operations at the 40-acre facility have resumed.
Impurities in mixed scrap such as stainless steel and especially copper must be removed from scrap inflows prior to use in steel making operations.
“We have arranged to sell the scrap with the ICW and stainless temporarily to partners that can remove these from the scrap and keep it flowing to the market,” Hein told SteelOrbis. “In the meantime, all three of our facilities continue to run.”
Scrap market insiders told SteelOrbis, the fire’s effect on normal deliveries could cause local shredded scrap prices to rise, even though the facility was reported by market contacts to be “open and receiving scrap deliveries today.”
“BlueScope may have to go into the market and buy a little more (shredded scrap) than normal, that’s just my opinion,” one Midwest scrap insider told SteelOrbis. “I would assume that they will send the scrap to their Delta facility for processing.”
“While it is regrettable, the BlueScope fire could cause January scrap prices to rise,” said another Midwest scrap market insider. “Plus, we’ve got snow coming inbound across the Midwest, which could further stretch already tight scrap supplies.”
During the December buy-cycle, Ohio Valley shredded scrap settled down $10/gt from November to $375-380/gt ($381-386/mt) on delivered basis. The most recent market consensus for January scrap was sideways to potentially higher to December settled values, market insiders told SteelOrbis.
“Right now, January is looking a little up or sideways,” said another scrap market insider following the news of the fire. “No one expects much movement to the downside.”
BlueScope Recycling is a major player in the US Midwest scrap market, often quoted in monthly discussions about scrap market pricing. The facility is close to nine major US steel mills.
Local reports said the late-night fire, which occurred in a building used to sort shredded vehicles and other metals, caused about $20 million in damages. While no one was working in the building at the time of the fire, one firefighter sustained minor injuries and was later treated and released from a local hospital, reports say.
