Mexico’s domestic ferrous scrap prices increased across most grades on continued demand as industries return to pre-pandemic operating levels. The automotive and manufacturing sectors are recovering in tandem with US’ improved economic indicators.
Mexican mills favor domestic supplies but have been actively importing scrap from the US’ West Coast, Southwest and Southern regions, especially in October. A falling Mexican peso against the US dollar may lead to a slow down in scrap imports. Simultaneously, domestic mills increased finished steel exports, sold in US dollar, giving the mills an opportunity to hedge scrap imports against their sales. In a weekly comparison, the peso noted a minor gain, and currently is at MXN20.41 per dollar against MXN20.55 last Friday.
Mills purchased HMS in mixed packages and P&S 5ft at $265-270/mt fob and $270-280/mt fob, respectively in the week. Deals were heard in Texas and New Mexico. Containers are actively being purchased from the West Coast with HMS 1&2 (80:20) currently priced at $270-275/mt fas, headed upward on export demand.
In North Mexico, the weekly Davis Indices for HMS 1&2 (80:20) rose by MXN67/mt ($3.28/mt) to MXN6,367/mt delivered, P&S 5ft increased by MXN91/mt to MXN6,441/mt delivered. Shredded went up by MXN167/mt to MXN7,117/mt delivered Mexico consumer. The index for #1 busheling inclined steeply by MXN483/mt to MXN7,433/mt delivered. Machine shop turnings were less affected and only increased by MXN50/mt to MXN6,100/mt delivered.
The weekly Davis Indexes in Bajío climbed across the grades with #1 busheling increasing only MXN13/mt to MXN7,063/mt delivered as the other grades encountered higher jumps. The index for machine shop turnings increased by MXN150/mt to MXN5,850/mt delivered and HMS 1&2 (80:20) climbed by MXN213/mt to MXN6,538/mt delivered while P&S 5ft rose by MXN200/mt to MXN6,450/mt delivered. Shredded rose by MXN163/mt to MXN6,538/mt delivered Mexico consumer.
In Central Mexico, the weekly indices were up by MXN100/mt across grades. HMS 1&2 (80:20) rose to MXN6,150/mt, P&S 5ft climbed to MXN6,550/mt, shredded increased to MXN6,950/mt, #1busheling rose to MXN6,550/mt, and machine shop turnings moved up to MXN4,850/mt delivered, all prices delivered Mexico consumer. Some consumers reported an increase of MXN200/mt in some transactions on shortage of scrap and increased demand.