Finished steel prices may still be rising in the US, but sources close to SteelOrbis say they don’t believe that will play a role in September’s scrap prices. As of today, sentiment as to where prices will settle is largely mixed.
Some dealers believe that September prices will “bounce back,” with HMS, shredded, and P&S scrap prices regaining what was lost in August, while others are questioning whether mills might try to take prices down again on cuts and shred, “just to see if they can get away with it.”
Reports on scrap inflow have also been mixed: some yards are reporting that flows are good, especially in terms of shredder feed, while others have said that in their region, shredder feed is tight.
Another factor that will play into September pricing relates to export activity (or lack thereof), off the East coast. “Export is not buzzing at all,” a source said, noting that if something changes between now and the end of the month, and exports start to pick up, that could have an impact on September settled prices.
In terms of recent ex-US cargo pricing, the most recent ex-US cargo sold to Turkish steelmakers was transacted at $461/mt CFR, against a range of $463-$464/mt CFR for the previous shipment, and most market players in Turkey believe that prices could decrease further.
Also of note, is that ex-Turkey rebar prices have softened by $20-$25/mt in the past week, depending on the mill and the fullness of their order books. If that downtrend continues—which could happen, as “Most international buyers are exerting pressure for further discounts as they are also taking advantage of the aggressive pricing policies from Indian and Middle Eastern suppliers”—that could place further downward pressure on ex-US scrap cargo pricing.
Asked to forecast September scrap prices today, one source said, “I’m in a sideways mood.” Another source noted that even as the middle of the month approaches, “the market hasn’t really shown itself yet. But if anything, I think the market has a greater chance of going down than it does of going up.”