US scrap pricing for October is now seen sideways to lower next month as a result of reports of adequate mill inventory and unremarkable demand expectations through the end of the year, scrap insiders told SteelOrbis this week.
This week’s October scrap assessment differs from one offered a week prior, when insiders said the October consensus was mixed with one side claiming ongoing mill maintenance outages would quell demand, while the other side said increased long steel output as a result of ongoing long steel capacity ramp-ups at Nucor NC and the new Hybar mill in Arkansas could increase scrap buying.
“One mill told me just a bit ago that October looks down” a Midwest scrap insider told SteelOrbis this week. “He said inventory at his place is decent and his order books aren’t looking that great through the end of the year.” He added, “November and December are looking sideways right now, while January could move higher.”
Historically, during the period from September through November, most US mills perform annual maintenance, reducing their scrap requirements as plants are shuttered.
During the recent September monthly buy-cycle negotiations, US scrap grades -with the exception of prime scrap grades- settled sideways for a fourth month. Prime grades only, settled $20/gt lower as a result of reports of plentiful busheling inventories at mills and continued low demand expectations, market insiders told SteelOrbis.
“We’re expecting to see the October scrap market sideways to down,” said another Midwest mill scrap buyer. “(Scrap) shipments have been solid, and mill outages should slightly reduce demand.”
During September scrap buy-cycle negotiations, following three months of steady pricing, US Midwest prime busheling scrap in the Ohio Valley, settled $20/gt lower at $415-440/gt ($423-448/mt), while shredded scrap settled flat to August at $375-380/gt ($381-387/mt). Ohio Valley P&S and HMS grades traded flat for a fourth month at $361-371/gt ($367-377/mt) and $325-345/gt ($330-387/mt), respectively, SteelOrbis monthly scrap data shows.
In the US Northeast, prime busheling grade material settled $20/gt less at $360-380/gt ($367-387/mt), while shredded grades settled flat to August at $325-335/gt ($330-342/mt). P&S and HMS grades finished sideways to the $295-305/gt ($300-310/mt) and 305-320/gt ($310-325/mt), respective August settles, scrap insiders told SteelOrbis.