Following the unexpectedly sharp mark-ups in December, the price trend on the German ferrous scrap market continued to point higher at the start of the new year. Although rising prices should be good news for scrap traders, continuing limited availability casts a shadow over the market.
Industrial plants have resumed production after the Christmas holidays, but arisings of production scrap are still modest, according to market participants. The supply of old scrap is even tighter. Demolition and collection scrap is extremely hard to come by. Consequently, there are fierce price battles to acquire shear and shredder input material, which is eroding margins.
There are still no signs that arisings will improve in the coming weeks, so recyclers currently expect at least stable prices for February. As usual, much will depend on the export business. As in December, international buyers were once again the driving force behind the rising prices in January. At the start of their negotiations with recyclers, domestic steel mills were still pushing for stable prices or even mark-downs compared to December. But beginning in the second week of the year, growing Turkish and Italian demand for imports finally triggered a price bump in Germany as well.
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