Recycled steel values rise in US

As a succession of winter storms hit portions of the United States West, South and Mid-Atlantic regions, sellers of recycled steel were finally able to receive several dollars more per ton in the January buying period compared with December 2024.

According to information gathered by news and pricing service Davis Index in the first half of January, average prices paid by domestic mills rose by $20 per ton or more in several U.S. regional markets.

A Monday, Jan. 13, report from the pricing service describes prices for all benchmark grades of recycled steel as “settling at $20 per gross ton above December’s settled prices.” The news service says those averages included “incentives, corrections and premiums” for certain grades.

The average gain was portrayed as nearly identical for the No. 1 heavy melting steel (No. 1 HMS), shredded and No. 1 busheling (prompt) benchmark grades. In its report, the price tracking service reports higher bids in markets including Chicago, Cleveland and Birmingham, Alabama.

While the price of prompt scrap, such as the No. 1 busheling grade tracked by Davis Index, can move differently when overseas buyers are active in the obsolete grade markets, in January prompt scrap pricing followed the same pattern as shredded and cut grades—often rising by $20 per ton on average in the domestic market.

Domestic mill buying discussions in the first and second weeks of January, according to Davis Index, pointed to a situation where several mills in the U.S. needed to rebuild their scrap inventories. Those discussions occurred at the same time ferrous scrap generation, collection and trucking was facing obstacles caused by winter weather.

Some regional purchases that exceeded the $20 per ton average included a $30 per ton boost for machine shop turnings in Cleveland and a $28 per ton increase for the same grade in Birmingham.

Davis Index earlier reported that while some processors initially were willing to sell in January at the same per-ton prices as the previous month, others signaled they were “likely to withhold tonnage from sideways bids” after rumors of $20-per-ton rise increases began to circulate.

The information services firm had predicted that because “steelmakers want to restock several mills nationwide,” what might follow would be that “buyers refusing to increase prices will eventually correct their position in the next few days.”

As it has in the past, winter weather likely played a role in disrupting a previously existing supply-demand balance. Some of the worst weather hit metropolitan areas in the South that typically are the least prepared to cope with snowfall.

An early January storm affected flows in a west-to-east belt from Kansas to Maryland while just a few days later another snow-and-ice-laden winter storm is moving on a predicted west-to-east route from New Mexico to the Mid-Atlantic states. The second storm then brought closed and slick roads to several metropolitan areas in Arkansas, Tennessee, the Carolinas and Atlanta.

As of the second week in January, the steel recycling export market is portrayed as unlikely to add to the upward price pressure, according to tracking by Davis Index.

Even when a strike loomed in early January, bulk shipments of HMS from New York were trading for just $315 per metric ton—below the price the grade fetched in December 2024. A tentative settlement to that port workers’ strike was announced late last week.

On the West Coast, selling prices likewise remained suppressed. Davis Index has HMS bulk cargoes leaving from Los Angeles as being purchased for just $306 per ton in mid-January. That figure, as in New York, represents a lower price compared with the prior month.