Scrap prices may have jumped sharply during this months’ buy cycle, sources note, adding that the “uptrend is far from over.”
“Russia’s invasion of Ukraine is still wreaking havoc on the global supply chain,” a source said. “Even if that conflict resolved by the end of the week, which no one thinks is going to happen, I suspect the effects of this war are going to be felt globally for the rest of the year.”
For example, yesterday SteelOrbis reported that ex-Brazil BPI was purchased by a US distributor at approximately $1,030/mt CFR Port of New Orleans. It’s also been heard that another Brazil-based BPI supplier is aiming to get prices up by more than $50/mt in the next round of bookings.
HMS I/II 80:20 scrap prices into Turkey are also still holding strong. Yesterday, SteelOrbis learned that a Marmara-based steelmaker booked an ex-UK cargo of HMS I/II 80:20 scrap at $651/mt CFR, which “is pretty much within spitting distance of where [prices] were last week.”
A third factor within this equation are surging US finished steel prices. Earlier today, sheet steel sources confirmed that US hot rolled coil spot market prices are now trending at $70+ cwt. ($1,543/mt or $1,400/nt), FOB mill, which reflects a mind-shattering 56% spike from price points heard at the start of the month.
“The writing is on the wall when it comes to scrap prices,” another source added. “I’m still not ready to put an exact number on it but we all know that prices are going up.”
And while some believe that prices for HMS, P&S and shredded scrap “will go up anywhere from $50-$100/gt next month,” the price expectation for prime grade scrap is far from agreed upon. Whereas conservative predictions put primes at up $100-$150/gt in April, other sources think that primes could spike by as much as $200/gt once the market is settled.
“All I can tell you is that there are a lot of moving parts to this thing right now,” a final source said. “I guess we’ll all find out where things land once it’s all over.”