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.
Due to our travel schedule this is a special Friday Commodities report July 31th, 2015 instead of our normal Monday report. My name is Greg Brown, President and CEO of the companies.
While last week was a very bad week for the recycling industry, this week was no better.
U.S. steel production in the U.S. came up a bit last week, which is part of the continued increase that has gone on since the April low of a few months ago, but steel production remains well below last year and below their historic highs. This is due to the flood of finished goods steel imports and the lack of demand.
|Oil Rig Count|
On the positive side, the oil rig count that was released this afternoon has risen for 4 of the past 5 weeks. Oil rigs use major amounts of steel. Oil prices have come down a lot in recent weeks, so this increase could be short lived.
And now for bad news, China remains weak, their stock market is in turmoil and since the U.S. economy is pretty good vs. Europe and China, the U.S. dollar is strong. The strong dollar hurts commodity prices which are based dollars. This chart shows steel prices near multi years lows as of today.
But things are getting worse. We believe when steel trades next week, it will be at least $20/GT lower than it is today.
This lowering of scrap prices had many scrap yards lower their prices in the past week. It will surely slow incoming flows and put pressure on scrap yards in the coming months.
Copper is going nowhere fast and in fact continues going down slowly. While somewhat stabilizing in recent days, copper prices hit a new 6 plus year low in the last week.
We see no reason for copper prices to increase any time soon, especially with copper inventories hitting a high for the year.
Aluminum is also just about at a 6 plus year low in the past week.
There is a positive though for Aluminum prices. Inventory levels are at 6 year plus lows, so there could soon be some stabilization of aluminum prices.
There was not a lot of major industry news this week, other than how bad things are. The major down turn in steel in the past few months and next month, combined with the new lows on Copper and Aluminum are going to put huge stress on scrap yards that are mostly retail. Sadly more closings will follow.
On the economy, things remain OK, but not great.
One of the key issues that remain a major drag on the economy is housing. New housing is less than half of what it was in 2005. Also this week it was released that while cars sales are near record levels, they are lower than they could be due to the average age of a car on the road today is at new a high, which is 11.5 years.
On the positive side, oil has come down a lot in recent weeks and we are seeing some major drops in gas prices. This well help consumers around the world and give them more money to spend on items that could help commodity prices.
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.