The recent UAW strike affecting auto production in the US is currently a wild card when forecasting US domestic scrap prices in October. If the strike runs longer than a few weeks, sources say busheling scrap supply will start to contract, which could lift prices unless mills take capacity offline. Sources say they’re watching to see if hot rolled coil prices fall below approximately $31.00 cwt. ($683/mt or $620/nt), which is the point when mills will likely make a decision.
As for shredded scrap prices, sources tell SteelOrbis that mills are currently buying slightly higher at mill-owned shredders, which could indicate firmness during the buy-cycle in a few weeks. Sources also mention that inventories at scrap yards are low, another factor that could impact scrap prices if the situation is the same in early October.
For now, most sources are keeping an eye on the UAW strike, with a tentative forecast of sideways scrap prices next month.