Prices for January have crept up a little more on scrap steel grades. Mills waited a little longer than usual to settle this month due to the snow/freezing temps experienced earlier this week that closed down much of the Midwest and Northeast. Early price speculations were predicting scrap prices up $20-$30GT due to the harsh winter weather limiting scrap flow into the mills and low scrap inventories at both the mills and processor’s plants. The mills waited it out and allowed the markets to cool slightly before firming up offers resulting in smaller gains. The West Coast saw some scrap grades fall $10/GT this month as the weakness on export prices gave mills in the West leverage to lower offering prices. This also lead to more scrap flowing into our local mountain west mills. Many believe we are possibly at the top of the market this month and February/March could be weaker priced month while other speculators are holding onto the hope of sideways to higher prices in coming months due to harsh winters and decreased scrap flows. Only time will tell who is right but we feel personally that we are near the top.
Recent reports out of China are stating that they may only import 1/2 of what they did in 2013. The high cost of scrap and its long travel time from the US is causing Chinese mills to use iron ore instead of scrap. Without China placing buying pressure on domestic mills, it will be up to other surrounding countries to step in and secure available tonnage. With these export markets remaining volatile, it is unclear what to expect in future months.
Prices on base metals have been riding a rollercoaster over the past 30 days and depending on what seat your sitting in, you may be on your way back up the hill or just stuck in the bottom watching others around you. Copper prices made a steady, slow climb in December peaking just before New Years but has been in a downward fall so far in 2014 with only moderate rebounds. The overall good news on copper is that prices are still slightly higher than Decembers average despite the recent weakness. Aluminum started December very low and made a sizeable rebound and prices began to raise quickly, however, the raise was temporary and by mid month prices were on their way down again. A second sprint occurred just after the new year but this run too failed to keep its momentum and its back down only slightly above the December lows. Nickel prices started to gain a little momentum thru December but failed to maintain this drive and has fallen below December levels and appears to be stuck at the bottom of the market.
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