Last week, SteelOrbis sources from throughout the US said they believed that June scrap prices were likely to fall by $20-$40/gt in June due to still-falling flat rolled steel prices and less-than-exciting scrap export activity (and less-than-stellar export cargo sales pricing) into Turkey.
This week’s survey results have netted similar responses, with most sources saying they believe the downtrend will vary based on region.
“I’d [still] agree with the down $20-$40/gt with down $20/gt being the South and down $40/gt happening in the Midwest/Northeast,” said a source from the Southeast. “Flows seem solid but are certainly down based on the discussions that I’ve had.”
Others agreed, with some saying they feel that June prices should bottom out the market.
“Obviously the domestic mills will try to push prices down if there’s no pressure [to stay steady or increase] from export,” a Northeast source added, noting that in his region, flows have slowed 45-40% for all grades. “I think this is the bottom for the domestic market and maybe we’ll be surprised and the market will go sideways to down $20/gt depending on the grade.”
A source in the Midwest also said his flows are sluggish, adding that his industrial scrap inflow is down by approximately 50%, year-over-year.
A final source said they also believe the market could be down $20/gt, adding they believe that if HRC prices continue to fall, that June prices may not, in fact, be the bottom.
“I don’t see it going down all the way to $40/gt, at least not in all regions,” they added. “[However,] if flat rolled keeps falling I see scrap coming off in small chunks over the summer months.”
The June buy-cycle is not expected to start until after the conclusion of the Memorial Day Weekend holiday.