Following two straight months of lower US scrap pricing, the June expectation for US domestic scrap is mixed this week, following earlier reports calling for a sideways to lower expectation. Market insiders said the weekly call is mixed because of slightly higher spot flat steel pricing and continued reports of high scrap and rebar inventory on the US Gulf Coast.
“Shredded scrap is expected to be sideways to up $10-20/gt for June 2025,” said one Gulf Coast rebar dealer. “I’m hearing that shred feed in the Detroit area could be down $30-40/gt for June,” said another Midwest scrap insider.
This week’s mixed market call for June scrap could be the result of earlier reports of mills in “no-buy or reduced buy mode” during the May scrap buy-cycle when values declined $30-40/gt, insiders told SteelOrbis. This situation, they say, may have led some producers to scale back their output of flat steel, prompting this week’s higher price offers in the local spot market with hot rolled coils (HRC) up $12.50/nt to an average of $847.50/nt ($934/mt), or $42.375/cwt.
“Flat steel prices are all over the place,” said one Midwest flat steel buyer, adding, “Some mills are offering deals, some are not.”
Long steel insiders, asked about scrap price expectations, said that the start of three new rebar mini-mills in June could cause scrap prices to rise. Together, Commercial Metals Company’s (CMC) 500,000 annual-ton Martinsburg, West Virginia mill, Nucor’s 430,000-annual ton micro mill at Lexington, North Carolina, and Hybar LLC’s 700,000 annual-ton Hybar mill in Osceola, Arkansas, will account for more than 1.6 million annual tons of new rebar production when at full capacity.
“Scrap could go up,” commented one East Coast rebar dealer. “There are three new mills that will need (June) scrap,” he said, “but will the Nucor mill and the new CMC mill just shift (scrap) tons from other mills to the new rebar mills? If so, there won’t be more scrap demand; just shifted.” He added, “Plus, if there is a domestic market for scrap, less will be exported. So, I don’t think increased domestic mill demand is going to upset the scrap pricing too much.”
Still another scrap insider said export scrap demand for US scrap was improved, noting a sideways expectation for June scrap, while still another heard a lower call. “I’m hearing from a source that shred will be down $40/gt next month,” he said. “I’m not sure I buy that [the significant price drop expectations],” he added, mentioning a sideways movement is more likely. Reacting to media reports that there was a 300,000-ton scrap overhang in Texas because of Mexico being out of the scrap markets for going on three months as a result of Section 25 steel tariffs. “That doesn’t help the market; that’s a lot of scrap,” he said.
On Tuesday, May 13, the completion of monthly buy-cycle negotiations yielded a US Midwest prime busheling scrap settling in the Ohio Valley $30/gt less than its April counterpart at $435-460/gt ($442-467/mt), while shredded scrap fell $40/gt (41/mt) to $375-380/gt ($381-386/mt). Ohio Valley P&S and HMS grades saw $40/gt price drops to $361-371 ($367-377/mt) and $325-345/gt ($330-351/mt), respectively. US Northeast busheling settled $30/gt less at $380-400/gt ($386-406/mt), while May shredded scrap lost $40/gt to $325-335/gt ($330-340/mt). P&S and HMS grades declined on average $40/gt to $295-305/gt ($300-310/mt) and 305-320/gt ($310-325/mt), respectively, scrap insiders said.
SteelOrbis’ scrap data show that, since monthly domestic scrap prices peaked in March ahead of the much anticipated tariff announcements from the US Trump administration, the average price of Midwest Ohio Valley shredded scrap has slumped more than 24 percent from on average $506/gt ($514/mt) to $384/gt ($390/mt). HMS pricing in the US Northeast dropped a more conservative 22.8 percent during the equivalent period to on average $313/gt ($318/mt), the SteelOrbis data show.