Scrap Prices North America

HRC vs. prime scrap spread narrows again in January

Written by Ethan Bernard & Stephen Miller

January 15, 2025

The price spread between hot-rolled coil (HRC) and prime scrap continued to narrow in January, according to SMU’s most recent pricing data.

While SMU’s average HRC price edged down week over week (w/w), it rose compared to a month ago. The January price for busheling also increased from December.

Our average HRC price as of Jan. 14 was $685 per short ton (st) FOB mill, east of the Rockies, down $5/st w/w. Compared to a month ago, HRC prices are up $10/st.

At the same time, busheling tags increased in January. They are up $20 per gross ton (gt) month over month to an average of $412.50 per gross ton (gt). Figure 1 shows price histories for each product.

After converting scrap prices to dollars per short ton for an equal comparison, the differential between HRC and busheling scrap prices was $317/st as of Jan. 14. That’s down $8/st from the previous month (Figure 2). This is the second consecutive month it has narrowed slightly after remaining flat at $328/st in October and November.

What’s going on?

After the holiday break, steelmakers came back to the market to buy scrap, despite not achieving a price increase in HRC. This increase in demand caused #1 busheling scrap to rise, thereby narrowing the spread. Looking ahead, if HRC prices do not rise next month, the general view is scrap prices will be no worse than sideways.  

HRC premium as a percentage

The chart on the right-hand side below shows the spread relationship differently: We have graphed HRC’s premium over busheling scrap as a percentage. HRC prices hold a 66% premium over prime scrap. That’s up from 72% a month prior.

Ethan Bernard

Ethan Bernard is a reporter and editor for Steel Market Update. He previously worked for American Metal Market as a copy editor in the New York office for two years starting in 2008. Later, he copy edited AMM’s monthly magazine on a freelance basis from 2015 until 2017. With experience in financial copywriting and textbook publishing, he holds a BA in Comparative Literature from UC Berkeley, and an MFA. in Creative Writing from New York University. He can be reached at ethan@steelmarketupdate.com or 724-759-7871.

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Stephen Miller

Stephen Miller started his career in the scrap metal industry in 1978 at Luria Brothers in Cleveland. Over the last 40+ years, he has worked in all capacities in the trading business. He has had positions in both domestic and international scrap trading. In addition to scrap, Miller was at the forefront of the pig iron trade and established a pig iron distribution company under the name of Ferrosource, Inc. Most recently, Miller has concentrated on the scrap export market and regularly does consulting for several companies in the industry.

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