The recent quarterly report from the Bureau of International Recycling finds prices and demand for ferrous scrap worldwide creeping upward. The BIR notes that scrap prices have returned to levels of early 2000. While this price is still far below prices from the mid 1990’s, the sentiment in the market has noticeably changed.
The BIR also states that the hike in ferrous scrap prices is not a cause for great concern by consumers. The reasoning, according to the BIR, is that a hike in scrap prices would allow buyers to justify a hike in finished steel prices. “All efforts to increase steel prices have failed to date, but rises of $20-$40 appear to be gaining acceptability for most steel producers,” BIR states.
Meanwhile, world steel production continues to grow, with production up 1.2 percent this year. Meanwhile, many steel analysts say that total steel production needs to be further reduced.
On a positive note, the China steel market continues to grow at a strong clip, especially for steel bar and light sections. These products are the most dependent on scrap for raw material.
Another large importer of U.S. scrap, Turkey, also could start buying larger amounts of ferrous scrap from the United States. The BIR states that ”Turkey needs plenty of scrap, especially since it became known that their exports would be exempt from President Bush’s Section 201 measures. . . Turkey cannot get enough scrap from its traditional former Comecon suppliers in the Ukraine, Russia and Romania since these countries are continuing to restrict exports due to higher domestic demand in Russia and the Ukraine, and lower scrap collection in all three.
The above is an excerpt from the BIR’s quarterly report, World Mirror. More information on the Bureau of International Recycling may be obtained by contacting the association at www.bir.org.