U.S. South Sees Surge in Ferrous Scrap Prices This October

Southern U.S. Ferrous Market Sees Price Increases

The ferrous scrap market in the Southern United States has experienced notable price increases from September 21 to October 20, with mills in the region paying an average of $10 to $20 more per ton compared to other parts of the country. This trend was highlighted by the Raw Material Data Aggregation Service (RMDAS) operated by MSA Inc. in Pittsburgh.

Regional Price Disparities

During this period, mills in the Southern region, which includes states like Alabama, Florida, and Texas, reported an average price of $398 per ton for No. 2 shredded scrap. In contrast, the North Central/East region averaged $383 per ton, while the North Midwest saw an even lower average of $377 per ton. A similar pattern emerged for No. 1 heavy melting scrap (HMS), with Southern mills paying an average of $356 per ton—$32 more than the North Midwest and $23 higher than the North Central/East region.

Additionally, Southern mills also paid more for prompt scrap, averaging $412 per ton, compared to $404 in the North Central/East and $395 in the North Midwest.

Factors Influencing Price Increases

The rise in scrap prices can be attributed to several factors, including supply chain disruptions caused by two significant storms that hit the South in quick succession. Concerns about potential port shutdowns due to a brief strike by dock workers in late September also contributed to market fluctuations.

Moreover, while export prices have remained stable throughout 2024, bidding activity from Mexican mills and overseas buyers near Gulf of Mexico ports likely bolstered prices in the South. Bulk cargoes of shredded scrap from the port of New Orleans saw prices increase from $346.75 per ton freight on board (fob) on September 26 to $369.97 by October 14. However, the price subsequently decreased to around $356 per ton.

Mixed loads of No. 1 and No. 2 HMS from New Orleans exhibited a similar price increase, rising from $326.75 fob in late September to a temporary peak of $349.97 per ton fob in early October.