Scrap metal prices may have bottomed out after volatility: BIR president

Scrap metal prices may now be bottoming out following recent high volatility, the president of the Bureau of International Recycling, Tom Bird, said during a press briefing May 22 at the start of a BIR congress in Barcelona.

Prices rose dramatically as a result of Russia's invasion of Ukraine Feb. 24, on fears of a shortage of material, followed by a more recent significant price reduction, particularly for ferrous scrap, Bird said.

There's now more material around compared to immediately after the war erupted and "mills have to come back [to the market] and buy" ferrous scrap, Bird said. There are signs this is happening in Europe, including among Spanish mills which are putting prices out now, he said.

"For the last 10 days or so prices weren't available, you couldn't get a bid, but now mills are prepared to put a number on material," Bird said.

Turkey is still trading with Russia and there is a lot of cheap Russian material at the ports in Europe, Bird said. Russian scrap is still moving, impacting the market and dampening it, the BIR president said.

Turkey is a major importer of ferrous scrap.

"But the overhang will be consumed," Bird said. "We're seeing potentially a bottom to the market."

Platts assessed Turkish imports of premium heavy melting scrap 1/2 (80:20) May 20 at $460/mt CFR, down $5/mt on the day, according to S&P Global Commodity Insights data. While this price still showed a fall, sell-side sources indicated lower workable levels, expecting buyer demand to resurface soon.

Prices for this product had skyrocketed to an all-time high of $665/mt March 16 on fears that a shortage would be provoked by the war.

Prices for non-ferrous scrap products have generally fluctuated less, Bird said.