March scrap pricing in the US Midwest and US East Coast was little changed from a week earlier this week as the market remains mostly sidelined awaiting further clarification from the Trump administration concerning the implementation of threatened tariffs on imported steel.
March scrap pricing in the US Midwest is seen up a steady $30-40/gt ($30-41/mt) premium from February settles as inventories continue to be reported at low levels at both mills and suppliers. Recently, cold weather and equipment-related problems have impeded the processing and delivery of local scrap, market insiders told SteelOrbis.
“The talk is still up in the $30-40/gt range, possibly as high as the $50/gt” one Midwest scrap supplier told SteelOrbis. “There’s not much dialogue in the markets this week because of tariff uncertainty, but it definitely looks up because scrap supply is still tight.”
And, as scrap supplies remain tight, uncertainty about future trade flows remains high.
On February 24, SteelOrbis reported that US President Trump said threatened tariffs against Mexico and Canada would go forth after a 30-day delay on March 4, though two days later at a televised cabinet meeting, Trump reversed course, implying tariffs likely would go into effect on April 2. At this point, it remains largely unclear as to when and if tariffs will go into effect.
Data from the US Commerce Department indicates about 10 percent of US scrap consumption is met through imports of the material from Canada and Mexico, the US’ two largest trading partners. It’s generally thought that proposed 25 percent tariffs on Canada and Mexico will further trim those imports, with many expecting the two countries to retaliate against the US with their own tariffs. As a result, many US steel suppliers and distributors are reported to be stockpiling supply ahead of expected tariffs, causing prices in weekly spot markets to move sharply higher.
Similar to one week ago, based on a $30-40/gt increase from February monthly buy-cycle settles, Ohio Valley HMS 1 could settle near $410-430/gt ($417-437/mt) delivered to customer, while shredded scrap could settle near $465-470/gt ($472-478/mt) on a delivered basis. P&S is likely to settle near $456-$466/gt ($463-473/mt) delivered to customer, while prime busheling could settle around $490-515/gt ($498-523/mt) delivered to customer.
On the US East Coast, based on a sideways to higher March sentiment, HMS could settle at or above the $355-370/gt ($361-376/mt) February delivered to customer price, while shredded could settle at or above the $385-395/gt ($391-401/mt) delivered settle. P&S could settle at or above $355-365/gt ($361-371/mt) on a delivered basis, while prime busheling scrap could settle at or above $410-430/gt ($417-437mt) on a delivered to customer basis.