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US ferrous scrap market expectations have weakened ahead of July trade, with seasonal mill outages, extreme heat and power curtailments expected to limit demand and production schedules through the month.
Read on for some highlights from our US ferrous scrap market survey for July or click here to download your copy of the full US scrap trends outlook.
The Trend Indicator moved into bearish territory at 43.1 for July, indicating that participants expect weaker price conditions compared with the prior month. The Outlook’s prediction model, however, allows for a modest month-on-month price increase of 1.9%, following a flat actual price movement in the previous month.
Buyers are in wait-and-see mode Survey participant
Buyers are in wait-and-see mode
Survey participant
Survey responses suggest that mills are generally comfortable with the current flow of material into their facilities, while demand is expected to be slightly reduced by summer maintenance schedules and operating disruptions. The most commonly cited market driver was “All Unchanged,” suggesting no single factor is expected to dominate the market in July.
There was a notable split between market sides. Buyers and brokers were more bearish, with Trend Indicator readings of 40 and 33.3 respectively, while sellers were firmer at 56.0. Inventory was assessed at 50.6, broadly in line with average stocking levels.
Consensus was relatively high at 69%, indicating stronger-than-usual agreement among respondents around the market view. Overall, participants appear to see July as a softer and cautious market, with sufficient scrap availability and limited demand upside tempering price expectations.