US domestic scrap prices settle expectedly lower in April

In the beginning of April, mill buyers were able to negotiate a price decrease of anywhere from $15-$22/lt, depending on grade and region. Since mid-March, expectations have pointed to a price decline in in early April. Much of the price increases last month (as much as $40/lt in some regions) stemmed from constrained supply, lower flow, in addition to harsh weather conditions and a weakened US scrap export market. But throughout March, weather conditions and scrap flow improved--although not significantly and some dealers maintain that scrap flow is still not where it should be--and demand from mills also appeared to decline. Finished steel prices for all but long products have experienced some downward pressure in the last few weeks, which also contributed to mills looking to secure lower-priced scrap this month.

In the April early trading days, many dealers resisted the $20/lt price decline buyers wanted, attempting to hold firm at a $10-$15/lt drop, but eventually were forced to give in as the market began to settle. In the Midwest, scrap prices across all grades fell an average of about $20/lt from early March levels. On the East Coast, prices also fell by $15-$20/lt, essentially reversing gains in March. The export market, which many were hoping would soon pick up, has only moderately improved in the last week as Turkish mills have shown some renewed interest in booking cargos, although at prices $5-$10/mt lower than a few weeks ago.

US domestic scrap prices in early April were as follows: