Mexican ferrous scrap prices trended sideways in Bajío and Central Mexico but rose in Northern Mexico amid supply constraints in that region.
Market participants note price fluctuations will become more evident next week as some mills have started decreasing their prices while others are reducing volume intake depending on their immediate need, to deflate buying prices. A few mills were heard hinting at increasing buying prices on certain grades depending on the region.
Mexican mills have also been able to procure imported scrap at improved prices compared to early March, due to lower export prices from the US. Buyers and sellers are looking towards April as the Mexican ferrous scrap market is heavily vested in the US domestic market’s trends.
Mexican scrap buyers are bracing for strong prices into April with US’ present expectations of a sideways move in April on prime grades such as #1busheling and a mixed outcome on secondary grades such #1 HMS, P&S 5ft, and shredded depending on the region. In the Texas market, given the sideways to limited upside encountered in March, prices are expected to rebalance and trend up slightly in April against March settled levels.
Market participants expect ferrous scrap prices in Southeast and Midwest US to trend down $10-20/gt on seasonal increases in yard feedstock. Prices though are not expected to substantially tumble due to strong demand and mills seeking to maintain strong finished steel prices through the month.
The weekly Davis Indexes in North Mexico increased on Friday after trending flat last week. #1 HMS rose by MXN403/mt ($19.66/mt) to MXN8,919/mt delivered Mexico consumer, as P&S 5ft and shredded increased by MXN167/mt to MXN9,633/mt delivered and MXN9,583/mt delivered, respectively. Machine shop turnings increased by MXN217/mt to MXN8,283/mt delivered as #1 busheling climbed by MXN764/mt to MXN10,637/mt delivered. Some buyers noted buying #1 busheling at higher prices in some loads due to tight supply.
The weekly Davis Indexes in Central Mexico trended flat with shredded remaining at MXN8,060/mt delivered, #1 HMS at MXN7,800/mt delivered, and machine turnings at MXN7,710/mt delivered Mexico consumer. The index for #1 busheling was unchanged at MXN8,400/mt delivered while P&S 5ft was also flat at MXN8,250/mt delivered.
The weekly Davis Indexes in Bajío for #1 HMS, shredded, and machine shop turnings also remained unchanged at MXN8,720/mt delivered Mexico consumer, MXN9,670/mt delivered, and MXN7,620/mt delivered, respectively. The indexes for #1 busheling and P&S 5ft trended sideways at MXN9,670/mt delivered and MXN8,966/mt, respectively.
($1=MXN20.50)