Export, strong mill demand fuel US scrap trade

May's ferrous scrap trade is well under way, and negotiations in the much-observed Chicago market are proving the most interesting with the emergence of unforeseen underlying strength that is giving rise to some unexpected dynamics.

Many expected the Chicago market to roll over across the board from last month due to weaker demand since mills there are flush with inventory. But it now seems unlikely that buyers in Chicago will escape paying an increase, with mills making deals at $20 per gross ton higher for the secondary grades, prompted by similar moves in adjacent markets. The deep-sea scrap export market has also caught fire, with a European sale to Turkey rising by $15 per ton from the previous deal and adding further fuel to the upward price momentum in prices. Mills recognized that it made sense to give sellers up $20 per ton rather than risk it being shipped to the US East Coast for export. Chicago is sandwiched between Detroit and Arkansas, which are both booking deals on secondary grades at up $20 per ton...

Published

May 05, 2021

22:24 GMT

London, Pittsburgh