Rising Recycled Steel Prices: Key Drivers and Predictions
As the new year approaches, recycled steel prices in the United States are experiencing a notable surge, marking a potential continuation of this upward trajectory into January. According to the Raw Material Data Aggregation Service (RMDAS), prices rose approximately $20 per ton in December, driven by consistent demand from electric arc furnace (EAF) mills and overseas buyers eager to secure supplies.
Impact of Weather and Supply Chain Dynamics
The winter season is noted for disrupting recycling efforts, with adverse weather conditions historically impacting the availability of ferrous scrap. The tender situation is amplified by manufacturing plants, construction sites, and other scrap generators operating at reduced capacity during the holiday season, which further constrains supply just when demand is poised to increase. During the recent RMDAS tracking period (November 21 to December 20), mills reported paying significantly higher prices for various scrap types, notably a $24 increase for No. 2 shredded scrap.
International Market Influences: The Turkish Connection
Additional factors contributing to the rising prices include heightened activity from Turkish EAF mills, which have reportedly ramped up operations with capacity utilization rates reaching 96%. This surge in Turkish output comes at a time when U.S. mills may be faced with making competitive bids for scrap. With the overlap of domestic and international demands, scrap exporters are poised to capitalize by potentially increasing their asking prices as Turkish mills rush to lock in cargoes as well.
Price Expectations: What’s on the Horizon?
Looking ahead to January, analysts like Atilla Widnell from Navigate Commodities speculate that U.S. monthly settlements for recycled steel could increase by as much as $20-$40 per ton. This estimate factors not only the current robust demand and supply constraints but also the lingering impacts of winter weather and its effects on logistics and collection efforts.
Thoughts for Metal Recyclers: Strategic Planning Ahead
For those in the metal recycling sector, the current landscape presents an opportunity to enhance profitability through careful planning. Widnell suggests that recyclers could consider staging their scrap flows early in January, locking in transportation solutions ahead of time and focusing on real-time transactions rather than lagging behind industry data releases.
Conclusion: Navigating the Complex Landscape of Recycled Steel Prices
In summary, the recycled steel market is poised for notable volatility in early 2026, propelled by domestic demand, international competition, and seasonal weather impacts. Industry stakeholders would benefit from staying informed on these trends to navigate the complexities of pricing and supply effectively. As the winter ushers in potential supply disruptions, being proactive in managing scrap flows and transportation could position recyclers favorably for the upcoming months.
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