April’s forecast for the US ferrous scrap market lost steam and quickly changed from bullish to disappointing as March’s buying madness subsided and cooled down rumors of another three-digit increase.  Demand for prime grades drove prices higher this month but ample supply of cut grades and steel turnings produced disappointing returns.   This month’s prices settled prime grades up $75 per gross ton, cut grades down $20 per gross ton and steel turnings down $80 per gross ton. Shred was the only commodity to hold steady and slide into April sideways.

“March and April’s prime grade spike is due primarily to the lack of pig iron”, states Lou Plucinski, President.  “It will take some time to refill that supply chain.  We expect prime scrap prices to remain historically high for the next several months.”

The war between Russia and Ukraine has choked off pig iron production.  Panic buying in March created record breaking price gains and a two week suspension of the London Metal Exchange (LME).   Until that conflict is settled, domestic mills will continue their bull run for prime grades, pig iron’s main scrap substitute.  Steel mills have also adjusted their mix to use other alternatives like DRI and HBI.   Prices for pig iron from countries other than Russia and Ukraine have leveled off to around $1,000 per ton.

Russia is also the world’s third largest producer of nickel and its largest exporter of refined nickel metal.  While Russia’s nickel exports haven’t been targeted by sanctions, U.S. and European buyers have nonetheless sought alternatives to Russian sources, impacting domestic nickel and stainless steel markets.  The nickel market experienced a slight correction when trading resumed on the LME.  It has since regained some stability and prices for 300-series were steady to higher week this week.  Additionally, stainless steel mills and foundries are actively buying materials due to short scrap supply.  Expectations for stainless steel scrap prices are to be sideways to slightly up for the balance of April.

“Scrap traders and non-ferrous consumers alike are mildly bullish when discussing April’s non-ferrous markets,” states George O’Brien, Director of Non-Ferrous.  “None of the markets, however, make a whole lot of sense.  Very indicative of what’s going on in the world.”

Copper and brass scrap metals mirror the volatility of the daily ups and downs of the Comex trading market.  Spreads for copper and brass have remained consistent but the wild Comex swings makes it difficult to strike a deal. Unfortunately, the volatility is not expected to stabilize anytime soon; prices are changing seemingly every minute.

Aluminum scrap metal has continued a steady climb, displaying the most consistency of the non-ferrous scrap commodities. Most experts in the industry are bullish on aluminum and anticipate a continued increase in aluminum prices throughout the month.  Rising demand, European reduction and supply chain issues are driving the aluminum scrap market.

Plan on scrapping inventory or obsolete materials this month?  Contact us to get a quote.