Wilson Metal Recycling
Metal Commodities and Recycling Report
404 Maury St. S. Wilson, NC 27893
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.
Today is Monday, July 13th, 2015. My name is Greg Brown, President and CEO of the companies.
There was nothing but turmoil and bad news in the markets last week, despite some very good news two weeks ago. Today, Monday things remain very precarious with the Greek debt issue looking like there may be some resolution and China’s stock market being a key worry.
U.S. steel production came down a bit in the last two weeks after a few months of gains. In recent weeks there has been word of a softening of orders in many industries which is a concern.
Oil Rig Count
One the positive side, we mentioned last week that automotive sales in June had hit a ten year high. We can add that last week the oil rig count rose for a second week in a row, after 29 weeks of declines. This along with strong automotive sales is a positive for U.S. steel consumption. With that said oil prices dropped about 8% last week, which will probably stem this increase in U.S. oil drilling.
Oil production in the U.S remains strong and if there is a deal with Iran on nuclear issues, that will reduce world oil prices as Iranian oil flows freely.
Heavy Metal Price
Put together there was a dramatic change in ferrous prices last week. This chart will show a dramatic drop with next week’s update. Last Monday, there was word that some markets were stable and even up. By Tuesday, all looked down a bit and by Wednesday as word in China and Europe turned negative, ferrous prices came down $20-$25 per GT. As an example of bad news, the Chinese stock market after almost doubling in the past year fell 36% in about a month.
Since that the fall, the Chinese government stepped in last week and has been pouring money into their stock market, which toward the end of the week, had its best days since the crash of 2009.
Note that the lowering of steel prices will further reduce flow and profits in scrap yards, especially in the SE, but there is enough scrap metal coming in from Europe on barges to meet demand.
Copper prices crashed along with steel last week. Copper hit new 6 plus year lows on Wednesday. Again as China slows, copper prices are hit hard. With oil prices yet again coming down, this should work to increase consumer spending and should help copper prices.
Last week aluminum had almost the exact movement as copper, by hitting a new 6+ year low mid-week and then bounced up a bit.
These low volumes and profits in the scrap industry, took yet another toll last week. Kemp Recycling that had three North Carolina operations two years ago, closed two of them about a year ago and there is word that the third and last one closed last Friday. This mostly retail scrap yard is the type of yard that is being hurt very badly in this downturn that shows no sign of getting better anytime soon.
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.