RMDAS numbers show sustained strength of ferrous market

May steel mill transactions recorded by the Raw Material Aggregation Data Services (RMDAS) of Pittsburgh-based MSA Inc. show prompt grades of ferrous scrap have retained their lofty pricing while shredded scrap and heavy melting steel (HMS) gained about $20 per ton in value.

The rise in shredded and HMS prices helped close what has been (and remains) a sizable difference in the value of prompt scrap compared with the two obsolete grades. In the April buying period, the RMDAS prompt Iidustrial composite grade was worth $144 more per ton compared with shredded scrap and an even more sizable $164 per ton compared with No. 1 HMS.

In May, while the RMDAS prompt grade moved up by just $3 per ton, shredded scrap gained $21 per ton in value and No. 1 HMS added $24 per ton in the May buying period.

Steel output figures in the United States and globally continue to demonstrate strong demand for steel. Demand for steel has likewise prompted demand for ferrous scrap used as a feedstock, particularly in nations with significant electric arc furnace (EAF) or induction furnace capacity, which includes the U.S., Turkey, India and Bangladesh.

Within the U.S. scrap market, RMDAS May figures show prompt grades trading fairly evenly in all three RMDAS geographic regions: $577 per ton in the North Central/East; $574 in the South; and $573 in the North Midwest region.

Pricing for No. 1 HMS, a common export grade, shows a wider disparity, with the export-heavy North Central/East region fetching $441 per ton for No. 1 HMS, while the South lags at $405 per ton and the North Midwest at $419.

Shredded scrap showed a similar pattern, but with the premium in the North Central/East smaller compared with No. 1 HMS. The RMDAS Shredded Scrap No. 2 grade was purchased for an average of $454 per ton in the North Central/East, $448 per ton in the South and $443 in the North Midwest.

Although steel output in 2021 has been marked largely by week-to-week or year-on-year increases, the Washington-based American Iron and Steel Institute (AISI) reported a small decline in output for the week ending May 22 compared with the week before.

According to AISI, domestic crude steel output the week ending May 22 fell by 0.3 percent compared with the previous week (ending May 15), with the mill capability utilization (or capacity) rate dropping from 79.2 percent the week ending May 15 to 79 percent for the week ending May 22.