US ferrous scrap prices are expected to increase in November after mills raised their offers during a drawn-out October buying round, according to market participants cited by Steel Market Update (SMU). Sources anticipated another upward move, although the scale of any increase remained uncertain following October’s stronger settlements.
Opening bids for October material at increases of $10–20 per gross ton failed to secure sufficient volumes. Buyers subsequently agreed increases of $20–30 per gross ton, SMU reported. Several sources also indicated that some mills paid above those levels later in the month to complete their purchasing requirements, highlighting the difficulty of covering their needs at initial offers.
Scrap sources attributed October’s firmer market to strong US mill demand and order books, alongside seasonal factors. Export prices had strengthened during September before easing slightly, according to one participant cited by SMU. Dealers and mills also expected scrap flows to slow as the end of the year approached, adding a supply consideration to the outlook for the next buying round.
The extended US scrap negotiations also formed part of the backdrop to subdued Brazilian pig iron trade into the US. Activity remained limited over the past month despite expectations among traders that business would pick up after the International Iron Metallics Association meeting in Chicago. SMU reported that the prolonged October scrap buy could partly explain the inactivity, while the eventual scrap price increases could alter buyers’ and sellers’ expectations for pig iron settlements.
Meanwhile, SMU reported that the spread between domestic hot-rolled coil and prime scrap prices widened for a 13th successive month in October, reaching another multi-year high. Its average hot-rolled coil assessment stood at $1,280 per short ton, up $10 on the week and $40 from a month earlier. October busheling averaged $480 per gross ton, an increase of $12.50 from September. Both products therefore recorded gains, but the reported coil-to-scrap spread continued to expand.