Due to the tight scrap supply and the firm scrap export market, US domestic scrap prices have stayed sideways to up $25/long ton ($24.61/mt) in the beginning of November, depending on grade and region.
November East Coast busheling scrap prices stayed sideways to up $10/lt ($9.84/mt), shredded scrap prices increased $20/lt ($19.68/mt), and HMS I prices climbed $25/lt ($24.61/mt) when compared to early October prices. Cut grade scrap prices registered an increase of as much as $30/lt ($29.53/mt) in some Midwest areas. Currently, East Coast busheling scrap prices are in the level of $400 to $410/lt ($393.68 to $403.52/mt), shredded scrap prices are at $355 to $365/lt ($349.39 to $359.24/mt), and HMS I prices are between $335 to $345/lt ($329.71 to $339.55/mt).
Although the US finished products market is still slow, US scrap prices went up in November in response to the approaching winter. This seasonal price uptick is expected to continue for the next two months; since scrap collection and transportation will become more difficult during the winter months, domestic mills will need to secure the scrap tonnages beforehand. At the same time, scrap availability is already tight in the market and domestic mills' scrap inventories have started to run low. With this taut situation, some US scrap suppliers will be in the position to hold the materials and sell it later at higher prices. It is anticipated that the domestic scrap prices will go sideways to slightly up in December and increase further in January.
On the other hand, strong export demand for scrap has supported the domestic scrap price increase. Current export prices to Turkey remain firm at $390-$395/mt CFR ex-US.
The latest USITC data show that the total amount of ferrous scrap exports from the US in September was 1,316,000 mt, reflecting a decrease of 85,000 mt month-over-month and a decrease of 289,000 mt for the same period year-over-year.
The main recipients of shredded scrap form the US in September were: Turkey, at 211,000 mt; South Korea, at 94,000 mt; Vietnam, at 50,000 mt; Egypt, at 37,000 mt; Peru and Taiwan, at 31,000 mt each; and India, at 20,000 mt. Countries that imported smaller amounts of shredded scrap from the US during the month include: Indonesia, Canada, Malaysia, China and Mexico.
For HMS I grade scrap, the top recipients of US exports in September were: Turkey, at 209,000 mt; South Korea, at 78,000 mt; Taiwan, at 77,000 mt; Egypt, at 59,000 mt; Vietnam, at 44,000 mt; and Indonesia, at 24,000 mt. India, Canada, Mexico and China also imported some tonnages of HMS I grade scrap from the US during the month as well.
As for pig iron, tight supply has pushed the prices to go up. Current pig iron prices are at $460/mt CFR Nola, reflecting an increase of approximately $20/mt from a month ago. There is still not a lot of pig iron buying activity at the moment, however, it will be tough to acquire pig iron later when domestic mills replenish their inventories.