Confidence in US domestic scrap trend for January remains mixed

Even though many early predictions point to a US domestic scrap price increase in the beginning of January, how much prices could rise is still up for debate. At the beginning of December, when scrap prices settled mostly sideways (and down $5-$10/lt in some select regions), some scrap dealers predicted that January could bring significantly higher prices since demand levels this month were only about 60 to 65 percent of what they usually are, according to SteelOrbis sources. However, as December progressed and finished steel prices for most products softened, predictions for the January scrap price trend moderated as well.

While demand will be up in January, sources said it won't be substantially higher, and one dealer commented that February is likely to be a much stronger demand month as many mills remain far from closing their January order books. Nonetheless, the combination of a recent uptick in export scrap activity on the US East Coast and inclement weather conditions in much of the Midwest could be enough to drive an increase in scrap prices. Current predictions range from moderate increases of $10-$20/lt, to more significant price jumps of as much as $40/lt. In the last week, a number of US bulk scrap cargos have been sent to Turkey at ever-increasing prices. Deals concluded in the past few days reflected an increase of about $10/mt from sales just a week earlier.

US domestic scrap prices in early December were as follows: