While the US domestic scrap market had not officially settled for January by Friday, initial sales were pointing to little change from December pricing. Ahead of the Christmas holiday, many predicted that the market would be decidedly up when prices settled this month. The anticipated increase stemmed from rising export prices on both the US East Coast and US West Coast, tightening scrap flow due to heavy snowstorms in certain parts of the Midwest and East, and the fact that scrap prices traditionally rise substantially at the start of the New Year. However, with finished steel prices for a number of products still weak--particularly flat rolled--and mill order books for January and February far from full, mills entered the January scrap market aiming to attain sideways pricing.
At first sources told SteelOrbis that dealers balked at the lower prices, insisting on an increase of at least $10-$20/lt from December, but as negotiations wore on, a sideways trend in the Midwest and the South became the most likely scenario. Scrap prices have yet to settle entirely, but Chicago mills and mills in the South are said to be booking at sideways levels, while the Pittsburgh/Cleveland markets are undetermined. Dealers indicated that mills aren't restocking scrap much this month, and although availability is tighter than in December, that wasn't enough to push prices higher in the Midwest. The Eastern mills, meanwhile, purchased shredded scrap at prices up about $10/lt from December, bringing prices to approximately $390/lt, and HMS I scrap prices are settling at up $10/lt as well. With export scrap prices off the US East Coast to Turkey currently standing at around $400-$410/mt CFR, up about $10-$20/mt from price in mid-December and Turkish mills looking to secure more scrap for winter production, the US domestic scrap prices in the East are likely to settle up about $10/mt from December levels.