Metal Commodities and Recycling Report
Goldsboro Metal Recycling
We Buy Junk Cars For More Cash
801 N. John St.
This is the Commodities and Recycling report, brought to you by BENLEE the industry leader in roll off trailers and open top scrap trailers, as well as Raleigh and Goldsboro Metal Recycling, the leaders in North Carolina for Scrap Metal, Cardboard, Electronics and Junk Cars.
Due to our travel schedule this is a special Friday Commodities report July 24th, 2015 instead of our normal Monday report. My name is Greg Brown, President and CEO of the companies.
This week may have been the worst week in the recycling industry since the crash of 2008.
U.S. steel production ticked up a bit again last week, which goes along with the continued slow increase in the U.S. economy. Steel production in the U.S. is clearly off its low of a few months ago, but it remains lower than last year due to the continued flood of imported finished steel goods into the U.S.
|Oil Rig Count|
The oil rig count which was falling for over six months has turned up a bit in recent weeks, which is good news for steel consumption due to the large amount of steel used in these rigs.
Now the bad news. Scrap steel continues to come in from Europe and DRI, which is a substitute for scrap metal, also continues to flow to steel mills, so scrap metal prices remain weak. Importantly, they are now forecast to fall to yet a new multiyear low early next month. Many scrap yards have lowered prices in recent days due to this.
This chart shows the current pricing of scrap steel, but when this is updated in about two weeks, as said, it will hit a new multi year low.
Copper is just a bad. Copper hit a new 6+ year low today. China’s lack of growth is a huge drag on copper prices.
|Copper Stock Levels|
Related, copper inventories are close to a new high for the year, so there is more than enough copper in the market to keep prices down. There is no good news for copper prices.
Aluminum, which also hit new lows two weeks ago, hit new lows yet again in recent days. China remains shipping Aluminum to the U.S. as their markets slow.
Gold also hit multi year lows this week. Gold which was over $1,900 an ounce number years ago, hit a 5 year low this week and is under $1,100 today. In summary key drivers for falling commodity prices are China’s slow down and since the U.S. economy is doing OK, the U.S. dollar remains strong, meaning commodities which are priced in dollars are going down.
As for industry news, Steel Dynamics which owns OmniSource released earnings this week that showed while OmniSource made money last quarter it was down significantly from last year. Nucor Steel also released earnings, but they did not say how their recycling group did vs. last year.
On the positive side, unemployment claims in the U.S. literally hit a 40 year low last week, meaning job growth is good in the U.S., but many of the new jobs are low wage jobs, which is not good for commodities.
On a sad story, Loeb Lorman Metals in Wisconsin has filed for receivership and is up for sale, after about 100 years in business. With market conditions deteriorating weekly, we know there will be more of this to come.
For current prices, please call us at 919-828-5426 in Raleigh, 919-731-5600 in Goldsboro.
With that we hope all have a Safe and Profitable week. Tune in next week for the Commodity and Recycling report.