Market
December 1, 2023
Miller on scrap: Export market prices rising
Written by Stephen Miller
The export market for ferrous scrap has been strengthening over the last month by a sizable margin. In the first week of November, prices from the US East Coast averaged roughly $372 per metric ton CFR Turkey. On Nov. 30, it was reported a cargo of HMS 80/20 was sold from the US to Turkey at $404 per metric ton CFR with a component of shredded scrap at $424 per metric ton.
The reason behind this abrupt jump in prices seems to be a lack of supply in Europe coupled with increased demand for scrap in the US market as winter sets in. Prices for December in the US are expected to rise again by at least $20 per metric ton for obsolescent grades and more for prime grades. But this is not the only reason export prices are rising on a delivered basis.
SMU spoke to a large scrap export executive on the East Coast to get his views on the recent price increases. “All we’ve gained recently has been eaten up by increases in ocean freights,” he said. He noted that sea levels have been dropping, and this has limited the number of vessels that can transit through the Panama Canal.
This has caused freight rates in the Atlantic Basin to rise by $15-20 per metric ton. “It could get worse,” he went on to say. He sees prices rising into the $410-420 per metric ton range for HMS in the coming month or two, if demand holds up.
Besides Turkey, the other main buyers are in Mexico, and they mostly want shredded scrap – which some say is becoming in shorter supply.
According to trade participants, the export yards along the US East Coast have been receiving normal flows of HMS into their terminals without having to raise prices or reach out for remote tonnages. But this could change with winter weather on the way. The prices paid for HMS delivered to East Coast terminals is averaging $275 per metric ton.
Export conditions on the US West Coast are not quite as brisk. The main buyer for bulk shipments is Bangladesh at around $420 per metric ton for HMS 80/20. But orders are not readily available there. The container market into Taiwan has been active with prices on the rise. The most recent price for HMS 80/20 is $380 per metric ton CFR, and it could rise from there.
The post Miller on scrap: Export market prices rising appeared first on Steel Market Update.