Ferrous market in US South strengthens in October

From Sept. 21 to Oct. 20, mills in the United States South paid from $10 to $20 more per ton on average for steel scrap compared with counterparts in other parts of the U.S.

The higher prices in the South during the 30-day period were tracked by the Raw Material Data Aggregation Service (RMDAS) operated by Pittsburgh-based MSA Inc.

The RMDAS figures show mills in the U.S. South region (consisting of Alabama, Arkansas, the Carolinas, Florida, Georgia, Louisiana, Mississippi, Oklahoma, Tennessee, Texas and western Virginia) paid an average of $398 per ton for No. 2 shredded scrap during the 30-day stretch. That compares with a figure of $383 in the North Central/East region and just $377 in the RMDAS North Midwest region.

A similar discrepancy was present in the other major obsolete grade tracked by RMDAS, No. 1 heavy melting scrap (HMS). For that grade, mills in the South paid an average of $356 per ton in late September and early October, a price $32 per ton higher than what mills paid in the North Midwest and $23 higher than the mill cost in the North Central/East region.

Southern mills also paid more prompt scrap ($412 per ton) in the recently ended period compared with their counterparts in the North Central\East ($404 per ton) and the North Midwest ($395).

The presence of two significant named storms hitting the South in rapid succession in September and October may have temporarily interrupted the scrap supply chain there.

Also likely coming into play in late September were concerns surrounding port shutdowns in late September, as a union representing dock workers at several ports conducted a strike (that turned out to be short lived).

Although export prices largely have been stagnant in 2024, the existence of bidding from Mexican mills and overseas buying near Gulf of Mexico ports in late September may have helped boost Southern scrap prices.

Bulk cargoes of shredded scrap leaving the port of New Orleans began rising in price from $346.75 per ton freight on board (fob) on Sept. 26 to reach $369.97 by Oct. 14, according to Davis Index.

Since then, the port of New Orleans price has drifted back down to the $356 per ton range, according to the pricing service.

Mixed No. and No. 2 HMS export loads from New Orleans experienced a similar price bump during the timeframe, according to Davis Index, rising from $326.75 fob in late September and temporarily peaking at $349.97 per ton fob in the second week of October.