Containerized ferrous scrap prices for the US West Coast (USWC) export market remained unchanged for another week and actually increased in some deals in the higher end of the price range. HMS I/II 80:20 was sold in some deals at $310/mt FAS Long Beach port, leaving the price range at $305-310/mt FAS. Last week it stood at $305/mt FAS. Contacts in USWC are more confident now that the market has reached bottom, even though some market factors are still unclear.
There have still not been confirmed reports of higher freight rates from USWC to Asia. Yet the possibility that they may increase soon is what is keeping USWC exporters attentive and trying to protect their margins. The price of West Texas Intermediate (WTI) crude oil has increased in the last five weeks from $71 to $77-81 per barrel, yet has remained unchanged from last week. In the meantime, some scrap traders and buyers have mentioned that they remain cautious in this market.
Other containerized ferrous scrap prices in USWC include P&S 5ft, which was sideways this week at $325/mt FAS Long Beach port, and shredded, which was flat at $330/mt FAS port.
Even with current stability, some stakeholders in the scrap trade believe prices for containerized scrap could drop slightly, and containerized HMS I/II 80:20 could hit a bottom of $300/mt FAS port due to still soft market fundamentals affecting Asian markets. These contacts do not envision prices for that grade in USWC going below $300/mt FAS port, as they note that the costs at yards that handle prepared scrap are too high to go below that level.
Bulk scrap to docks
Exporters at the docks have also kept the prices of their inflows stable for another week. Participants in the region mentioned that the $10-20/gt price drop announced three weeks ago has not been implemented, as exporters need to be cautious in the current market to secure enough volumes to fulfill their outgoing orders.
This has kept the price of bulk HMS I to Los Angeles docks at $240-250/gt delivered export yard, P&S 5ft at $270/gt delivered, and shredder feed at $190-200/gt delivered. San Francisco Bay Area bulk scrap prices are also unchanged at $250/gt delivered for HMS I, at $260/gt delivered for P&S 5ft, and at $200/gt delivered for shredder feed.
In Texas, the market environment is not very clear. Some contacts report that there is a surplus of material and that shredded and cut grades, in particular, could drop by $10/gt in the August trading cycle. Others mention that mills and exporters are battling for volumes as scrap is in short supply. It should be noted that sources in other regions of the country have also alluded to ample volumes of available shredded material and expect the price to come down slightly next week.
In the meantime, the price of HMS I to Houston docks remains at $320/gt delivered export yard, the price of P&S 5ft remains at $345/gt delivered, and for shredder feed it still sits at $320/gt delivered.
