Steel Products
Early Reports Have February Scrap Prices Moving Lower
Written by John Packard
February 6, 2013
A number of domestic steel mills are reported to have purchased their February scrap needs at prices below January price levels. The price levels range from down $5 on some products in the east to as high as down $30 per gross ton on some items in the Ohio Valley. The average appears to be closer to down $15-$20 per gross ton in most markets.
In the middle of January many dealers were speculating scrap prices would move sideways (no change) for the third month in a row. At the time Steel Market Update commented when dealers hope for a sideways move many times they are disappointed and prices move lower.
One of the larger national dealers told us in an email, “The domestic market pricing is sliding down to the level of export dock pricing which appears to be in the $350-$360 gross ton delivered range on secondary grades. Given the lack of any material improvement in mill operating rates, scrap pricing will likely remain soft.”
While out of the east one of the dealers told SMU, “The entire market is down, which for some regions like the eastern US is a surprise for many who thought just two weeks ago the market would not be down here and would probably be higher because of lackluster flows. But the OH Valley and south turned out to be weaker than was expected, export turned decidedly weaker (notwithstanding the weaker dollar), and there seems to be a lot of prime scrap coming down from Canada. DJJ has been trying to buy at down $20 for some time now. Hence, we are seeing prices down $5 – $15 in the east (more for shred and prime), and down $15-$20 in the OH Valley. The order books at the mills in the valley are clearly weak and most people don’t think there are going to get better soon. Scrap continues to move in the east because of export and some decent local mill buying volumes.”
In the Midwest we heard of one large mill buying their scrap for the month at down $10 while another mill with plants in both the north and south bought their material down $20.
We understand the Detroit, Michigan and Cleveland, Ohio markets are down $20 per gross ton as of this afternoon.
Pig iron prices are reported to have drifted higher during the month of January from $403 per metric ton to $415 per metric ton CFR NOLA.

John Packard
Read more from John PackardLatest in Steel Products

US, offshore CRC prices continue to diverge
US cold-rolled (CR) coil prices declined again this week, slipping for a third straight week. Most offshore markets did the opposite, moving higher this week.

S232 lifts EU HR price over US, Asian HR still well behind
Domestic hot-rolled coil prices were flat this week after dropping for four straight weeks. Most offshore markets bucked the trend and gained ground.

SMU Steel Demand Index dips into contraction
SMU’s Steel Demand Index has moved into contraction, according to late April indicators. The slowdown comes in response to growing tariff uncertainty after the index reached a four-year high in late February.

Nucor selects Fives Group for new galv line at CSI
Nucor Corp. has tapped Fives Group as its partner in designing and manufacturing the new continuous galvanizing line being added at its California Steel Industries (CSI) joint venture in Fontana, Calif.

AISI: Raw steel production levels off near six-month high
The volume of raw steel produced by US mills remained relatively flat last week, maintaining the rebound seen one week prior, according to the American Iron and Steel Institute (AISI). Previously at the second-highest rate of the year, production continues to hold at one the strongest levels recorded over the last six months.