The price decrease stems from the $40-per-gross-ton decline in Chicago No1 busheling, a key feedstock for SBQ production.
Fastmarkets understands that SBQ producers treat changing scrap surcharges as an automatic pass-through to the market.
The scrap price decline has caused SBQ spot prices to erode by $4 per cwt in the past two months, although sources noted that SBQ base prices remain unchanged.
“SBQ is following scrap down the rat hole,” one consumer source said.
Fastmarkets assessed steel bar hot-rolled SBQ 1-inch round 1000 series (carbon), fob mill US at $34 per cwt ($680 per short ton) fob mill on Friday October 11, down by 5.6% from $36 per cwt the previous month and off by 26.1% from $46 per cwt at this time last year.