July is shaping up to be a strong sideways market. While July is typically a softer month due to summer slowdowns and automotive retooling, healthy mill order books, strong steel production, and tightening scrap flows continue to support demand. Prime grades have the most upside potential as busheling generation remains constrained, while obsolete grades are expected to remain stable. Overall, the market appears well-balanced, with enough demand to offset the normal seasonal weakness associated with July.
Prime grades are expected to remain the most supported segment of the market. Elevated pig iron replacement costs continue to support busheling demand, while seasonal automotive shutdowns and reduced manufacturing activity are expected to limit the generation of prime industrial scrap. If supply tightens further, prime grades could experience modest upward pressure during July settlement.
Obsolete grades appear more balanced. Stronger seasonal scrap flows are increasing supply availability across the Midwest, while domestic mills continue to actively consume available tons. Export markets remain softer than earlier in the year, with Turkish buyers continuing to pressure imported scrap pricing lower. However, healthy domestic demand has largely insulated inland markets from export weakness.
“Domestic demand continues to support the market. Prime grades remain the area to watch as supply tightens through the summer.” — Lou Plucinski, President & CEO
What we are Watching
- Prime Scrap Supply During Summer Seasonal Slow-Downs
- Export Activity & Turkish Demand
- HRC Prices
- Pig Iron Prices
- Finished Steel Prices & Steel Production
- Mills Order Books
Chicago’s Ferrous Scrap Market
In Chicago, July is expected to remain strong sideways. Prime grades continue to be supported by strong domestic demand and tightening seasonal supply, giving them the greatest upside potential. Obsolete grades are expected to trade more steadily as improved scrap flows help balance healthy mill consumption. The widening spread between prime and obsolete grades remains a key market theme heading into July’s trading period..
Market Drivers. High pig iron costs continue to encourage mills and foundries to substitute domestic busheling where possible, supporting demand for prime grades. At the same time, automotive retooling schedules and holiday-related production slowdowns are expected to reduce the flow of new industrial scrap into the market.
For obsolete grades, domestic demand remains healthy, with Midwest mills securing tons quickly to maintain inventory levels through the summer months. While weaker Turkish import demand continues to weigh on export sentiment, strong inland consumption has helped support Chicago pricing and limit downside risk.
Logistics & Market Access. BL Duke continues to leverage its multi-modal transportation network — truck, rail, and barge — to provide reliable service, maximize market access, and support stronger returns for our customers. With Midwest logistics conditions normalized, our team remains focused on creating competitive market options and delivering value across every grade and geography.
We will continue to monitor the market closely and update this forecast as new information becomes available leading up to the monthly trade.
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