RMDAS Ferrous Prices Show Plunge

Mill buyers seemed to have the upper hand in August as they paid from $40 to $70 per ton less for ferrous scrap grades tracked by the Raw Material Data Aggregation Service (RMDAS) of Management Science Associates Inc. (MSA), Pittsburgh.

The biggest drop in pricing took place in the highest-price grade tracked by RMDAS: The Prompt Industrial Composite grade of new production busheling and bundles. That grade dropped by an average of $69 per ton nationally and by $71 in the North Central/East region (To view a larger image of the chart click on the following link -- August RMDAS Pricing).

Other grades followed in the decline, with the #2 Shredded Scrap grade being purchased for an average of $42 per ton less and #1 HMS being sold for $40 less per ton.

The average price paid per ton of the Prompt Industrial Composite grade was $274 in the firsts three weeks of August. The grade continues to trade at a higher price per ton than shredded scrap, which averaged $231 per ton in August, or #1 HMS, which brought an average of $204 per ton in August.

The price drop in August pricing marks the biggest swing recorded since MSA began publishing its RMDAS index for ferrous scrap. The previous biggest swings for the #2 Shredded grade were a $26 rise in November of 2005, a $23 per ton gain this February and a $13 per ton drop in December of 2005.

Regionally, mills in the United States South continue to pay less on average for alll grades of scrap, although the differences have narrowed compared to the previous few months.

For the Prompt Industrial Composite grade, Southern mills are paying $8 per ton less than mills in the other two regions. Southern mills are paying either the same or just $3 per ton less than buyers in other regions for the #2 Shredded Scrap grade, but from $5 to $8 per ton less for #1 HMS.

The Raw Material Data Aggregation Service (RMDAS) Ferrous Scrap Price Index is based on data gathered from a statistically significant compilation of verified ferrous scrap purchase transactions.

To view the complete set of monthly Ferrous Scrap Index figures released by MSA, including those on a regional basis, click on the following link -- Index Figures.

RMDAS is a service of Management Science Associates Inc. (MSA), Pittsburgh. Those seeking more information about RMDAS can contact MSA’s Ralph Pinkert at 773-588-1199 or via e-mail at RPinkert@MSA.com.