After three months of consecutive downward movements in the US domestic scrap market, SteelOrbis has been informed by several sources that stable to positive results are expected in the October scrap buy-cycle. Additionally, sources believe that the stable to positive momentum in October is supported by the fact that the downward movement in the September scrap buy-cycle ended up better than initial expectations that placed downward movements at up to $30-40/gt ($30-41/mt).
Sources in the East coast informed SteelOrbis of expectations that prices will likely increase across all grades in October while a Chicago source stated, “Let’s hope no one goes on strike. A stronger sideways to positive would be my best guess today.” In correlation with support for a positive movement, a source informed SteelOrbis that some shredders in the Pennsylvania and Ohio area have increased feedstock prices by $10-20/gt ($10-20/mt) depending on grade. A scrap dealer in the Ohio Valley commented that October could recover “half to all the September decline” depending on the scrap overhang dealers have at the end of the month from September scrap inflows.
In regards the potential for a strike at US Steel and ArcelorMittal, a source close to the large mills commented that the shut down costs along with restart costs at a time when business is good and essential to the Trump administration’s plan to support the steel industry was “inconceivable.” He elaborated that certainly anything could happen in the future, but that the possibility for a massive strike given all present conditions is extremely small and he hoped for at a minimum a short-term contract with future revisions.
SteelOrbis reported on the September price movements in the East coast and Midwest.