The monthly Davis Index for UK 1&2, 3B and OA ferrous scrap consumer increased by £22/mt ($29/mt), £29/mt and £27/mt to settle at £198/mt, £210/mt and £225/mt, respectively, delivered UK mill, after mill-yard negotiations were concluded in September.

 

According to market participants, some British steel producers “tried their luck” by opening negotiations late last week with flat bids as compared with the prior month, despite a £20-25/mt hike in dockside purchase prices over the past three weeks.

 

A ferrous scrap supplier told Davis Index that some mills were able to purchase cargoes at unchanged prices from the prior month, though progressively higher adjustments had to be made to secure the necessary volumes for their melting requirements.

 

It now appears that domestic steel producers have had to increase premiums paid over dockside ferrous scrap prices to meet robust demand from the export market.

 

Local mill-yard settlements have typically settled £10-15/mt above dockside rates over the past few months, largely representing freight costs, though premiums have now climbed to above £20/mt following the conclusion of September’s contracts.

 

As for demand, there does not appear to have been any significant improvement in domestic ferrous scrap consumption with crude steel production rates remaining subdued since July’s reading of 515,000mt, 18.1pc below the same month last year.

 

The monthly Davis Index for UK 4A/4C, 8A/8B, and 12A/C ferrous scrap consumer increased £20-22/mt to £228-235/mt, and £28-30/mt to £228-235/mt, and £21/mt to £230/mt respectively, delivered UK mill. 

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