With the upcoming Memorial Day Holiday on May 28 as well as the recent imported scrap deals by Turkish mills at lower prices on HMS I/II 80:20 from the Baltics and the EU at $333/mt CFR and $338/mt CFR, respectively, US domestic scrap sellers, especially those on the East coast, are silent today as they assess pricing for the June scrap buy-cycle. A scrap buyer said, “I will likely not hear back from East coast yards on domestic pricing calls I made until after the holiday.”
Over the past week, ex-US offer prices to Turkey on HMS I/II 80:20 decreased from approximately $350/mt CFR to the lower $340's/mt CFR. The lack of export sales to Turkey is expected to move some supply inland for sale to domestic mills and dampen US domestic scrap prices on shredded, P&S, and HMS I scrap. A source noted, “Cut grades such as shredded scrap may trend down, but prime grades such as busheling may be able to trend sideways on tight supply and continuing transportation challenges.”
A separate source noted that despite high finished steel prices in the US, mills may try to place slight pressure on busheling scrap but that active pig iron import buys by US mills points to the strong demand for the high-quality scrap grade, therefore, allowing for seller resistance.
Some contacts predict that scrap trading in the US may not begin until June 4 since it is now much more likely to face downward pressure from mill buyers on the export effect and strong supply from both domestic feedstock and imported scrap cargoes, despite the strong domestic demand as mills hover over the 75 percent utilization rate.