The last three months have moved the US domestic scrap market down with shredded scrap encountering $90-100/gt ($91-102/mt) price erosion in the three-month period. June scrap trading was met with more aggressive mill bids than expected. Initial expectations were of soft-sideways but as June progressed sellers feared a downward turn of $10-20/gt ($10-20/mt). Mills opened the trading week with bids of $30/gt ($30/mt) on cut grades. Several sellers informed SteelOrbis that the large mills even sought to push shredded scrap down by $35/gt ($36/mt) as the trading week closed.
Speaking with East coast sellers, SteelOrbis has been informed that “export sales seem to be close to the bottom.” The supply and demand balance in the export market is expected to alleviate some of the pressure from the upcoming US domestic scrap market trading week.
Sources in the Midwest inform SteelOrbis that “scrap consumption is weak and is expected to remain weak for the next 45-60 days.” Therefore, opinions range from sideways to down approximately $5-10/gt ($5-10/mt) in the July scrap trading week. Another drastic bid round from mills is not expected given the effective negative influence on finished steel products. Both flat and long products have hit 18-month to 2-year price lows and are expected to be “near bottom.” A source stated, “Finished steel goods seem to be getting bottom capped with the potential for upcoming price increase announcements expected as mills try to regain domestic market traction.”