RMDAS Shows Ferrous Pricing Nearing $300 Mark

Mill buyers have been paying from $22 to $37 more per ton in their February buys of ferrous scrap, depending on the scrap grade and the geographic region.

Figures compiled by the Raw Material Data Aggregation Service (RMDAS) of Management Science Associates Inc. (MSA), Pittsburgh, show across-the-board strength in February mill purchases. (Click on the following link to see a larger version of this chart -- February Pricing)

Nationally, mill buyers paid $35 per ton more on average for prompt industrial No. 1 busheling and bundles, $31 per ton for No. 2 shredded scrap and $26 per ton for No. 1 heavy melting scrap (HMS).

Price gains have occurred for three straight buying periods, with processors and shippers of ferrous scrap finding attractive pricing that in some cases is punching through yet another dramatic barrier—$300 per ton for ferrous scrap.

February of 2006 also demonstrated price spikes, according to the RMDAS figures from one year ago, perhaps reflecting both increased post-holiday demand as well as weather-related supply shortages.

In February of 2006, mills were paying $245 per ton on average for No. 2 Shredded Scrap—a healthy price, but below this year’s $287 average figure.

Demand for ferrous scrap remains strong globally and domestically. Expecting pricing to zoom past $300 per ton on average may be unrealistic for March, although seasonal patterns provide some historic trend lines that indicate it is also quite possible.

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.

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.