Skip to main content

Stainless recover challenges scrap suppliers

The supply of scrap has not kept up with the pace of the strongly recovering stainless market, according to the founder and ceo of the ferrous and non-ferrous scrap price-reporting Davis Index, Sean Davidson.

Davidson made the observation during the latest online webinar for the stainless steel and alloys committee of the Bureau of international Recycling. ’Scrap generation simply hasn’t kept up with the pace of recovery recorded in finished stainless steel demand,’ he said as he considered the key national markets.

While tight supply has driven US scrap prices around 30% higher in 2021, yards have been hit by margin compression resulting from competition for materials, according to Davidson. India, meanwhile, will ‘remain a strong market for a very long time’ because of its still relatively small per-capita consumption of stainless steel and low scrap ratio.

And he predicted that China’s stainless steel production in 2021 would exceed the 30 million tonnes projected earlier in the year. The US, Indian and Chinese markets are relatively bullish, he said, whereas Europe was unlikely to return to really strong levels before 2023.

Turning to the ferrous scrap market, Davidson pointed to elevated finished steel prices in the USA but to substantially smaller increases for steel scrap owing to healthy supply as well as to higher metallics imports and domestic DRI/HBI production. This situation had resulted in steel producers achieving ‘great margins’.

Davidson anticipated an increase in demand for steel scrap next year and some shrinkage in spreads.

Don't hesitate to contact us to share your input and ideas. Subscribe to the magazine or (free) newsletter.

You might find this interesting too

Kuusakoski tops national growth league
Costache, Burrage and Sacco kick off RI Top 100
E-scrap players will see new highs

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Subscribe now and get a full year for just €169 (normal rate is €225) Subscribe