Steel Input Costs: Scrap Flat at $412/MT; Zinc Near 3-Year Highs at $3,300/tonne
Why It Matters for Steel Warehouse
Stable scrap prices while HRC rises above $1,000/ton means EAF mills (Steel Dynamics, Nucor) are enjoying **expanding processing margins** — which has historically led to sustained pricing strength. For SW's purchasing, this is a signal that domestic HRC prices may hold longer than in previous cycles where scrap cost escalation drove temporary spikes followed by reversals. Elevated zinc prices at $3,300/tonne directly pressure **SW customers processing coated products** (HVAC fabricators, automotive body stampers, construction panel manufacturers). Cost pass-through friction may slow order activity in galvanized-dependent customer segments. The CORE AD/CVD orders (see Section B) compound this: coated steel import prices are now inflated by both 232 tariffs and AD/CVD duties, while domestic coated steel prices are supported by zinc cost pressure. Customers will be squeezed from both sides.First reported: 2026-03-08 Section: E — Raw Materials & Input Costs
Scrap — Flat and Stable: North American scrap steel prices for HMS and busheling have held essentially flat in early March 2026 following a February uptick. #1 Busheling — the prime scrap grade consumed by EAF flat-roll mills (Steel Dynamics, Nucor) — is priced at approximately $412/metric ton delivered mill Chicago, per Fastmarkets' March 5, 2026 assessment. North American scrap prices showed mixed-to-lower trends on the ScrapMonster index through March 3–6, with broad-based dips across grades. Stability in scrap pricing is consistent with the broader EAF mill dynamic: mills are passing through higher HRC prices based on demand/tariff dynamics, not scrap cost escalation — suggesting current HRC price increases above $1,000/ton represent margin expansion for EAF producers rather than cost-push.
Zinc — Near 3-Year Highs, Retreating: LME zinc reached a 3-year high of $3,430/tonne in late January 2026 before retreating to approximately $3,300/tonne in early February as a stronger dollar reduced speculative positioning. Morgan Stanley projects a 2026 average of $2,900/tonne for zinc. Global refined zinc demand is expected to grow 1% to 13.86 million MT in 2026, with refined output up 2.4% to 14.13 million MT — suggesting modest surplus that should keep prices from sustained spikes. However, zinc prices near $3,300/tonne remain historically elevated and are pressuring hot-dip galvanizing economics for SW's customers.
Key implications for Steel Warehouse's processing cost structure: - Hydrochloric acid (HCl) prices for pickling operations: no major disruption signals found in this research cycle — monitor for supply chain issues - Natural gas: Henry Hub remains relatively stable; no major spikes flagged - Electricity: no major grid disruption signals for Indiana, Ohio, Texas, or Tennessee in this cycle
Sources
- Publication of Fastmarkets Steel Scrap No.1 Busheling Chicago Assessment, March 5, 2026 — Fastmarkets
- North American Scrap Metal Prices — Broad-Based Dip — ScrapMonster (March 6, 2026)
- Zinc Price Forecast: Top Trends for Zinc in 2026 — Investing News Network
- Zinc's Global Price Trend Challenged by Regional Parameters — StoneX
Update — 2026-03-08
Initial entry — story first created. Scrap $412/MT flat = EAF mill margin expansion driving sustained HRC strength above $1,000/ton. Zinc $3,300/tonne pressing coated steel customer economics.