US scrap prices have not yet settled, sources note, adding that while some mills have come out with pricing that’s up "at least $20/gt" from April settled levels, other mills are attempting to buy at sideways.
“One of the [Midwest] mills we sell to came out at up $20/gt on shredded and P&S scrap and at sideways on busheling,” a source said. “But a mill in Indiana is offering at sideways.”
A second source said that while they too, had heard an Indiana-based mill that’s offering at sideways, that there’s been “quite a bit of chatter that they already did some deals above that.”
“The idea of sideways pricing just doesn’t make sense,” another source added. “If you’re looking at Indiana and East, there’s no real tons available. One mill we sell to doesn’t really have any [scrap] inventory, and another mill is hungry for tons. All of these mills are scratching to get their hands on material.”
Looking to the East coast, today’s news of new scrap cargo sales to Turkey from the UK, Germany and a Baltic supplier has many believing that ex-US cargo prices for HMS I/II 80:20 will rise to approximately $470-$475/mt CFR in the next sale to Turkish steelmakers. In contrast, the last ex-US cargo sold to Turkey, which was disclosed on April 28, was concluded at $432/mt CFR.
“There’s definitely room for export to be pushed up. Another mill we sell to is a black hole for HMS scrap right now. They’ll take anything that isn’t nailed down,” he continued. “I think the longer the mills wait, the more they’ll need to pay. I don’t think the dealers will rush to sell scrap because it’s a sellers’ market right now.”
An East coast-based source agreed.
“Two of the mills out here are offering at sideways on HMS but we don’t agree with that,” he commented, adding that while current East coast dock prices are hovering at $370/gt, it’s already rumored that at least one of the exporters plans to raise their prices by $10-$15/gt in the near future.
“Our overall view is that if export pricing is moving up, which we think is going to happen based on the recent sales to Turkey, that the domestic mills will have to pay fair market value.”
Others have indicated that if some of the mills they typically sell to, want to buy at sideways, they’ll sell elsewhere. For example, SteelOrbis has confirmed that a mill in the Southeast has come out at up $20/gt across the board. It’s also been heard that David Joseph has been buying scrap in the Pittsburgh region, for barge shipment, at up $20/gt.
“We have other homes for our scrap,” the East coast source continued. “We’re not going to give mills scrap at sideways if the market is up $20/gt+. If the docks don’t raise their prices, these mills might get some scrap, but if [dock prices] do go up, the [domestic mills that are trying to buy at sideways] will get shut out.”
US settled scrap prices are expected to emerge by the end of the week.