Posted on 28 Apr 2020
Most US scrap market players now agree that the possibility of another downward price movement is almost zero, despite uncertainty still prevailing in the US steel market.
US suppliers are unable to collect material due to measures against the coronavirus and interruptions in manufacturing. They believe price increases seen in export markets in the first half of April should reflect in May pricing. As US mills’ scrap demand is very low, on the other hand, a price hike of that magnitude seems unlikely for May. Meanwhile, scrap prices in Turkey, a major export destination, have now started to fall.
“There are too many unknowns regarding the timing of mills’ restarting operations and softening in coronavirus measures, et cetera,” says a Mid-West scrap supplier. “We cannot predict when these will happen. However, the reality is that there is no scrap. Another downward trend is impossible. I am expecting either a sideways or slightly increasing trend depending on the quality.”
Another scrap supplier tells Kallanish: “Due to the interruptions is manufacturing, there is no prime grade scrap. I am expecting to see higher prices in prime grades and shredded scrap. Cut grades’ pricing may be sideways.”
On the West Coast, US-origin HMS 1&2 80:20 containerised scrap prices rose for the second consecutive week in Taiwan. Due to the lack of offers from the US, prices which stood at $215/tonne cfr the previous week, increased to $225-227/t cfr throughout last week.
On the East Coast, Turkish mills’ absence from deep-sea scrap purchases has increased pressure on prices. The latest Baltic-origin scrap booking, concluded on 24 April at $242/t cfr Turkey for HMS 80:20, is expected to further decrease Turkish mills’ price expectations. This compares to $256/t in the previous deal.
As Turkey is the largest scrap importer in the world, the price fall in Turkey is expected to have an effect on US domestic scrap pricing and West Coast scrap pricing in the coming days.
Source:Kallanish
