Market
August 13, 2024
Recycled metals command premium rates
Written by Stephen Miller
After reports surfaced that U.S. mills were buying prompt scrap at sideways prices, RMU reached out to several dealers. These dealers revealed that they secured orders for #1 Busheling at prices higher than what mills and indexes reported for August. In our latest pricing article released last Friday, RMU listed the #1 Busheling price at $400/gt. While others reported it at $380/gt—the price buyers were paying back in July—the reality is that mills had to shell out more to get the busheling they needed. The going rate was $400/gt, and RMU stands by this assessment for August. In fact, we’ve even heard that some mills have paid above $400/gt in special deals.
This doesn’t mean the U.S. scrap market is strong. It’s not. Unfortunately, it shows there is a decline in the available supply of industrial generated scrap. This will be a factor to consider as we approach Q4 activity and as markets develop.
This week is an important week for the assessment of inflation and jobs. What comes out in these reports could affect the Fed’s decision to lower interest rates and reduce the cost of capital for American businesses, including our industry. RMU Correspondent Stephanie Ritenbaugh will follow up on the financial events of this week and provide the outcomes, which will hopefully benefit the recycled metals community.
The ferrous industry, both scrap and steel, are entering an unpredictable time where business is down despite rosier projections at the start of 2024. The economy is still growing but manufacturing is slowing, as RMU contributor Ray Peterson points out in his column this week. As steelmaking goes, ferrous scrap fortunes usually follow. It just shows how we are linked together for better or worse.
