Domestic ferrous grades in Canada decreased by C$20/nt ($15.9/mt) for secondary grades in Toronto and Montreal for the April trading cycle, while prime grades increased by C$5/nt ($3.99/mt).
The increase in prime grades, according to Canadian sources, is due to adjustments to the US and Canadian dollar exchange rates over the past month to keep the margin consistent with US grades, so that Canadian scrap grades are not over- or undervalued relative to their US counterparts. Some contacts reported that their calculations, based on the exchange rate, warranted a C$8/nt ($6.39/mt) increase in prime grades, yet mills offered only the $C5/nt ($3.99/mt) improvement.
On Monday, some mills were still issuing price announcements, consistent with those seen last Friday.
Mill orders have remained consistent, yet participants believe the price drops in cut grades are due to greater material availability. They expect flows to improve even more as temperatures continue to climb in Q2. Additionally, Canadian ferrous prices were heavily influenced by the US Midwest market, as is customary, with secondary grades dropping by $20/mt and prime grades remaining unchanged.
In Toronto, the price of #1 busheling increased by C$5/nt ($3.99/mt) in April to C$546/nt ($436.4/mt) while the price of HMS I fell by C$20/nt ($15.9/mt) to C$438/nt ($482.8/mt). Shredded fell by C$20/nt ($15.9/mt) to C$500/nt ($399.5/mt) in the Toronto region during the same period.
Montreal’s prices trended similarly, with #1 busheling rising by C$5/nt ($3.99/mt) to C$350/nt ($279.6/mt), while HMS I dropped by C$20/nt ($15.9/mt) to C$310/nt ($247.6/mt). Shredder feed in Montreal, known as tole or carcasses, trended firmer, dropping only C$10/nt ($7.99/mt) to C$210/nt ($167.7/mt).
For May, Canadian ferrous stakeholders are unsure of what could happen; they say it is too early, yet they are not counting on the market bouncing back. Depending on the export market, the pig iron market, and the prices of finished steel (the steel sector in general, which includes the current difficulties faced by steelmakers such as Algoma), they expect the market to either contract by C$10-20/nt again or remain sideways.
($1 = C$1.38)
