Last week, SteelOrbis sources were mixed on their predictions for April. Although some market sources said they expected an uptrend, others believed that prices would trend sideways, if not downward. This week, however, most sources polled say they believe that most prices will soften.
“There’s a good supply of cut grades and shredded scrap, although [busheling] scrap remains tight” a Chicago-based source said.
General Motors yesterday announced plans to idle their Missouri plant for two weeks and extend the shutdown at their Michigan assembly plant due to the global shortage of semiconductor chips. Other automakers, including Ford and Nissan, have also been impacted.
“We don’t see an abundance of busheling scrap being produced,” another source added. “Some are speculating that busheling could come down, but I’m more inclined to think that prices will be sideways.”
Another Midwest source agreed. “The speculation is that busheling will be sideways and that cut grades and shredded scrap will likely come down $20-$40/gt, which is a bit more than the down $10-$20/gt that people were predicting last week,” he noted. “The prices that the yards are paying to bring scrap in are down, but it’s still seasonally higher than it’s been at other times. All in all, it’s still a healthy market.”
“Peddler prices are still high and there are people out there that are willing to collect,” another source added. “I was at a couple of [scrap] yards this week and they were loaded with scrap. But I’ve also talked to some other guys who have yards in cities, who you think would be busy, but the scrap just isn’t coming in. Scrap inflow seems to be coming in pockets.”
On the East coast sources say they’re predicting a similar downtrend, adding that the export yards dropped their dock prices last week. “It’s already rumored that they’re going to take prices down by another $10/gt next week. So down $20-$40/gt seems to be the story.”