The December outlook for US scrap pricing remains sideways to potentially higher ahead of the US’ Thanksgiving day holiday later this week, scrap insiders told SteelOrbis. And while December scrap transactions are not expected to occur until next week after the holiday at the earliest, a majority of respondents polled by SteelOrbis this week said they expect pricing to be similar to November’s at sideways.
“Domestic scrap suppliers are leaning on upward pricing for December, but it’d baseless,” reported one Midwest-based mill scrap buyer. “The market will be sideways in December, with maybe some uptick possible in January, however, December will be another boring and knowable sideways market.”
One Detroit-based supplier begged to differ, offering his weekly expectation for a December market that is “looking $10/ish higher, maybe $20/gt up at best,” he said. “Another East Coast rebar dealer expects December pricing could trend up. “Scrap pricing always moves higher in the winter,” he said. “Rebar supplies remain tight, and rollings are getting cut or pushed back into future rollings.”
“There are no reports of issues with [scrap] supply,” remarked another Midwest scrap insider, calling the December market sideways. “Also, it’s a holiday month, so there will be less operating days, and demand will be more limited.”
One rebar trader cautioned that higher scrap pricing for December could cause domestic rebar prices to rise, which might trigger an influx of long steel imports, therefore, US mills will work hard to keep scrap pricing steady next month.
Domestic spot rebar pricing is assessed flat versus week-earlier levels at $46-47/cwt., ($920-940/nt or $1,014-1,36/mt), while import material on a loaded truck basis on the US Gulf Coast moved slightly higher one a widening trading range at $44.00-47.00/cwt., ($880-940/nt or $970-1,036/mt). Insiders said a minimum domestic rebar price of $47.00-48.00/cwt., could begin to encourage limited imports. January imports are expected to increase into the US Gulf as domestic pricing is likely to trade at $49.00-49.50/cwt., rebar insiders said.
While steady to higher scrap prices are still seen leading up to the start of December buy-cycle negotiations, based on a developing consensus for a sideways to up December settlement, US Midwest prime busheling scrap could finish next month near $385-395/gt ($391-401/mt) on a delivered to mill basis. Midwest shredded scrap, which is still called flat to potentially $10-20/gt higher, is likely to finish for December at or above its November close at $365-370/gt ($371-376/mt). Ohio Valley HMS grades which finished sideways for November, are likely to settle flat again near $315-335/gt ($320-340/mt), while P&S scrap, which settled flat this month, could settle near its November close at $351-361/gt ($357-367/mt), scrap insiders told SteelOrbis.
December prime busheling grade material is likely to settle flat to potentially up near $340-360/gt ($345-365/mt), following its November sideways settlement, while shredded grades are seen sideways to potentially up from November settles near $315-325/gt ($320-330/mt). P&S and HMS grades could finish flat to higher than November near $280-290/gt ($285-295/mt), and $295-310/gt ($300-315/mt), respectively, scrap insiders told SteelOrbis.