A downturn in finished steel prices, a collapse in export deals and at least 21 mill outages planned through December have wrought havoc on the United States' ferrous scrap market, and October is expected to continue the negative momentum brought with this month's free fall.
The weakened September demand landscape quickly magnified the market's downside, turning an initially expected $20-per-gross-ton drop into a $30-40-per-ton reduction. Prime scrap ultimately declined by $40 per ton across the country while cut grades and shredded scrap fell by $30 per ton in the North and $40 per ton in the South. "Based off supply-and-demand dynamics, there was no reason for prices to go up in August. Flows quickly reversed and we didn't get to the point where supply [was] short. Now, we are giving the $20 back and then some," a Midwest broker said.US mills were preparing to offer material at down $20 per ton before the Labor Day holiday but an East Coast export sale to Turkey done at $256 per tonne torpedoed any hopes of a $20-per-ton drop. Mill buyers retreated...