Final Thoughts: Ferrous scrap market awaits

Even though it’s the fifth of the month, there have been no confirmed purchases by domestic steelmakers. Rumors are circulating about how low prices will drop. Most of the scrap community is forecasting a $50/gt drop for #1 busheling, with shredded and P&S at perhaps $40/gt. But the longer the wait, the more likely a steeper decline is in the offing.

U.S. steel mills could be looking abroad to see how their Turkish counterparts are doing with their scrap purchases. If they are indeed looking, they’ll be pleased to see the most recent sale from the East Coast was again weaker. This sale dropped almost $8/mt from the last sale which occurred last week. It settled at $385/mt CFR for HMS and $405/mt for shredded. A European cargo was then sold at $381/mt. So the trend is definitely heading downward.

All this adds up to a much weaker March scrap market here in the U.S. We should hear something later this week, but it doesn’t look like it will be very encouraging.