Procurement News Notice |
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| PNN | 8186 |
| Work Detail | A Detroit-area steel mill entered the market on Wednesday afternoon with bids to ferrous scrap suppliers down $30/lt for prime grades of scrap and down $20/lt on obsolete grades compared with August pricing. Suppliers sold at those levels and other Midwest steel mills quickly followed the lead. S&P Global Platts assessed shredded scrap at $220-$225/lt delivered Midwest mill, down $10/lt from Tuesday and down $20/lt from August. Mills "can kind of do whatever they want right now," one supplier said. "I just don't know if that [price] is going to follow through everywhere, but it certainly sets a trend to trade off of." No. 1 busheling was trading at $230/lt and plate & structural was trading at $215-$220/lt on a delivered mill basis in the Midwest. "Demand just looks weaker and weaker by the hour," one broker said. A mill buyer said that "suppliers hated the numbers but didn't have any other options -- they complain about what it will do to their flow and then ask if you can take additional tons." Weak demand related to low run rates and outages substantially reduced demand around Chicago and Detroit. The market was slower to develop in the Southeast. Some suppliers were being given indications by one consumer of a potential $40/lt fall on prime grades. "It seems pretty bleak," a trader said. Steel mills "are going to offer some suppliers a price that is going to have some sticker shock to it and [the suppliers] might not have another chance to sell if they don't take it." Trading is expected to continue on Thursday and wrap up by the end of the week. It is "still very quiet in the South," a Southeast recycler said. "Mills are in no hurry to enter the market. Most seem to have decent inventory and feel no pressure to get business done quick." He expected primes to settle down $20-$30/lt and obsolete grades to fall a minimum of $10, but expected dealer resistance at levels approaching down $20/lt, particularly for cut grades. "Mills are in no hurry and some mills with shredders are offering their shredded into the market," another Southeast recycler said. Another scrap dealer in the region had no firm prices yet, but had ominous expectations for pricing. He quipped that he heard "the faint sound of bayonets being sharpened." |
| Country | United States , Northern America |
| Industry | Metals & Minerals |
| Entry Date | 15 Oct 2016 |
| Source | http://www.platts.com/latest-news/metals/pittsburgh/midwest-mills-enter-september-ferrous-scrap-market-21457950 |
