Imbalance factors enter the recycled steel market

On the heels of a subdued pricing market for recycled steel that ran from May into November of 2025, factors that prompted higher bidding for the secondary commodity began to emerge in the final month of the year.

As had occurred in the first quarter of 2025, severe weather incidents in several parts of the United States in late November and early December have caused enough disruption to create construction and demolition work slowdowns and material flow interruptions.

By the second week in December, metals industry media outlets and pricing services were reporting an upward trend in bids made by U.S. mills during the traditional monthly buying period.

In its Dec. 10 summary of domestic recycled steel negotiations and prices, Davis Index described a $10 per ton price increase for prime and prompt grades while some shredded, plate and structural and heavy melting steel (HMS) grades were fetching $20 per ton more in December compared with November.

Davis Index referred to the inclement weather (and forecasts for more of the same) as contributing to supply bottlenecks that helped convince mills price increases may be inevitable.

The news service says the rising price of domestically made steel in the U.S. also contributed to an ability for electric arc furnace (EAF) mills to maintain their margins in the face of scrap price increases and provided confidence to processors and shippers to hold out for such an increase at the negotiating table.

Although the export market purchased less recycled steel in the first half of 2025 compared with one year earlier, in late 2025 there seems to be sufficient demand to provide one more reason why ferrous scrap is gaining value at year’s end.

Daily tracking by Davis Index for bulk No. 1 and No. 2 HMS cargoes leaving New York for Turkey shows transaction prices rising from about $305 per metric ton in the first week of November to more than $321 by the end of the month.

That 5.2 percent price increase was followed by an additional 3.2 percent bump (to $331.25 per metric ton) by Dec. 10 for a shipment tracked that day by Davis Index.

An East Coast trader says at least one Turkish buyer seeking affordable feedstock made a bulk cargo purchase off the West Coast in early December. He told Recycling Today that circumstance is relatively rare—perhaps last occurring about three years ago—and can be indicative of a dearth of available scrap in Western Europe.

In the export market, industry analysts point to an oversupply of billets and slabs from China as having poured into rolling mills in Turkey and India—the two leading importers of ferrous scrap—throughout 2025, tempering activity at EAF and induction melt shops in those two nations.

The People’s Republic of China has been the focus of attempted trade remedies imposed by other nations to stem that tide, but the wave of low-cost exports generally has found a welcoming shore throughout the 2020s.

The second half of 2025, however, has seen the European Union, Mexico and other frequent Chinese steel destinations introducing measures to deflect the tide.

In December, the Chinese government itself introduced a policy that also may contribute to reduced steel exporting activity, when the General Administration of Customs (GACC) of China issued a list of at least 100 types of steel or steel-containing products that will be part of an export quota system beginning Jan. 1, 2026.

Steelmakers and recyclers beyond China will be watching to see how the system genuinely affects steel trade flows from the nation.

This month, however, London-based Kallanish Commodities has cited China’s National Bureau of Statistics as announcing that China produced slightly less than 69.9 million metric tons (mmt) of crude steel in November 2025, a decrease of 10.8 percent compared with November 2024 output of 78.4 mmt.

The monthly 69.9 mmt figure for November 2025 also is 2.9 percent lower compared with the 72.0 mmt produced by China in October 2025 and 4.9 percent lower compared with the 73.5 mmt of steel Chinese mills made in September 2025, according to the Brussels-based World Steel Association.