Check please - Ferrous - ferrous scrap metal pricing trends - Brief Article - Statistical Data Included

Recycling Today, Dec, 2001

If there is any hope for a change in ferrous scrap prices, it might be that steel mills are genuinely running low on scrap inventory.

"The mills have to melt something," notes one Ohio scrap processor, referring to those steel mills that will still be running in 2002. Dealers have heard for several months that mills have sufficient inventory, but it can't last forever.

Meanwhile, red ink continues to abound in the steel industry, and merger talks between several integrated steelmakers are reported to be occurring as Recycling Today goes to press.

Between the potential mergers and the likely deaths of LTV Steel Corp., Cleveland, and Utah's Geneva Steel, integrated capacity in the U.S. will almost certainly be reduced.

On the mini-mill side, however, Nucor Corp., Charlotte, may be acquiring the assets of Trico Steel in Alabama, bringing that electric arc furnace capacity back online.

Presently, scrap dealers are scrambling for the reduced industrial ferrous scrap stream. One buyer in the Southeast believes industrial generation may be picking back up as the year closes, but only after a series of plant cutbacks and closures in his market.

What scrap there is has to be procured cheaply, however, as there is little margin to work on. An increasing number of dealers are now charging generators for container pick-up services, rather than issuing checks for the scrap enclosed.

"In some cases, transportation costs are actually more than the value of the material," notes one buyer.

No. 1 Heavy Melt Composite Pricing

(Per gross ton, monthly average)

October 2000    $82.56
November        $74.53
December        $78.60

January 2001    $84.83
February        $75.37
March           $76.77
April           $77.90
May             $76.67
June            $78.62
July            $79.81
August          $80.00
September       $80.00
October         $73.29

Source: American Metal Market

Note: Table made from a bar graph.