Ferrous pricing remains on narrow path

Recycled steel sector veterans accustomed to seeing prices move up and down continue to experience a ferrous scrap trading market trending far more toward stability instead of volatility.

The price of No. 2 shredded scrap, as measured by the Raw Material Data Aggregation Service (RMDAS) of Pittsburgh-based MSA Inc., has experienced just one significant up-and-down price cycle in the most recent 12-month stretch.

The price spike January through March largely was attributed to a series of winter storms that hindered scrap generation and shipping in several different parts of the United States, depending on the storm.

As the winter weather moved out, widespread and often sizable tariffs announced by the administration of President Donald Trump seemed poised to keep volatility on the recycled steel menu.

Instead, measured by RMDAS and Davis Index, prices for shredded scrap and other benchmark grades have settled into a pattern of stability that has run from mid-May into early October. 

The per-ton price for No. 2 shredded scrap paid nationally by domestic mills (as tracked by RMDAS) averaged $378 in May. In buying from June through September, that average price has not deviated by more than $3 per ton.

The No. 1 heavy melting steel (HMS) grade tracked by RMDAS has demonstrated a similar level of price stability.

In the five-month trading period from mid-April through mid-September, the RMDAS No. 1 HMS national price average paid by steel mills in the United States stayed in a narrow range of $332 to $337 per ton.

A spark of volatility, to the detriment of scrap sellers, was seen in September when U.S. mills were able to buy the three grades that make up the RMDAS prompt industrial composite for $425 per ton that month, representing a $19 decline from August pricing.

Without delving into domestic mill preferences for direct-reduced iron (DRI) or other scrap alternatives, melt shops in the U.S. should be exhibiting stable to rising demand for recycled steel this year compared with 2024.

With nearly nine full months in the books, the Washington-based American Iron and Steel Institute (AISI) calculates that through Sept. 27, mills in the U.S. produced 2.2 percent more crude steel compared with the same time frame in 2024.

The 66.7 million tons of steel made in the U.S. in the first nine months of 2025 represents an increase of more than 1.4 million tons made year on year. In 2025, U.S. mills have been operating at a 77.1 percent capability utilization (capacity) rate, higher than the 76.2 percent rate achieved from January through May of last year.

A recycler in the Great Lakes region, however, sees potential trouble ahead in his market, based in part on scheduled maintenance at U.S. mills.

“There are numerous outages September through November, further reducing mill demand,” he says. “I see scrap markets remaining relatively flat through the end of year, barring some black swan or geopolitical event, and I do not see any improvements in the market until we are into 2026.”

The status of export markets this year, characterized by struggles to receive higher bids from overseas buyers, may be an influential part of the recycled steel price picture in 2025.

On the West Coast, export prices for bulk shipments of mixed Nos. 1 and 2 HMS have drifted below $300 per metric ton at times this year and have been below the $320 per metric ton mark since early April, according to Davis Index.

The story on the East Coast is similar, as measured by Davis Index bulk cargo pricing for the Port of New York. That per-metric-ton price dipped below $300 this September and has been below the $320 per metric ton threshold since mid-April.

Market momentum heading toward the next potential winter weather spell is hard to discern. Domestic melt shops were staying busy heading into October. While the global steelmaking landscape has some bad news stories, production is steady or rising in two crucial recycled steel export markets—Turkey and India.

According to AISI, in the week ending Sept. 27, domestic raw steel production of 1.77 million tons represented a 6.8 percent increase compared with the same week in 2024 and a rise of 0.9 percent compared with the prior week.

In a third-quarter 2025 earnings guidance statement, Fort Wayne, Indiana-based recycled-content steelmaker Steel Dynamics Inc. (SDI) painted a picture of strong demand for its finished and semifinished steel.

“The nonresidential construction, automotive, energy and industrial sectors continue to lead demand,” the company says in mid-September.

Perhaps less positive for steel recyclers, SDI referred to “metal spread expansion” this July through September, as scrap raw material costs are expected to decline more than average realized steel pricing.

For exporters, January-through-August statistics gathered by the Brussels-based World Steel Association portray a global industry that was slowing down in the late summer, although not necessarily in two critical U.S. recycled steel export markets.

While steel output in August dropped month on month and year on year in China (which imports almost no recycled steel from the U.S.), Turkey and India join the U.S. as the only top 10 steel producing nations with growth in output in 2025.