US domestic scrap market pins hopes on March after February drop

As prices for February began to settle--falling anywhere from $10-$20/lt depending on the region--some already began to speculate about a more positive trend for March. At the beginning of February, scrap dealers told SteelOrbis that there was a significant amount of indecision in the market and mills came out looking to buy scrap at prices down about $10-$20/lt. In some Midwest cities such as Detroit, scrap prices took the biggest hit, with prices dropping about $20/lt. Meanwhile, East Coast mills paid an average of $15/lt less in February than in January across all grades, reflecting a similar drop in export scrap prices off the East Coast to Turkey over the same period.

However, it was a slightly stronger trend in the US Midwest that has some scrap sellers hopeful that the unusually weak start to the year will soon turn around. In the Midwest, while mills initially looked to pay at down $15/lt or so in February, some dealers resisted and the market settled at about $10/lt lower than prices were in January. Additionally, in anticipation that domestic prices may have reached a temporary bottom in February, some dealers held back inventory in case prices do rise next month. Nonetheless, sources cautioned that mill demand will be the driving force in determining where prices settle next month and demand from mills would have to significantly improve for domestic scrap prices to rise.

US domestic scrap prices in early February were as follows: