Heavy Metal Scrap Steered Ferrous Scrap Price Boom

SEATTLE (Scrap Monster): A combination of domestic and global factors led to significant rise in ferrous scrap prices during the month of January this year. The Fastmarkets AMM index prices have surged higher by nearly $90-$110 per ton during the buying period. The buoyant local as well as overseas market demand, coupled with logistics constraints boosted the prices.

The biggest surge in prices was recorded by heavy melting scrap (HMS) in East Coast region. The prices of the material were up by $110 per ton. The exports from the region witnessed healthy rebound during the month. Meantime, exports from the West Coast and Midwest regions remained less buoyant with prices rising from $90 to $107 per ton.

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Meantime, buyers of manufacturing scrap reported that supplies have started to pick up following the general market weakness on account of the pandemic. The extended jump in scrap prices has delivered good margins for scrap processors. However, processors and traders are faced with extremely high shipping rates for containers and dry bulk cargoes.

The dip in infrastructure spending by Chinese administration along with traditional fall in demand due to upcoming Chinese New Year are likely to result in reduced export demand in the coming days.  

The rising domestic and global steel production will further boost the demand for scrap.