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Don’t Get Too Excited About 2023
ALSO: Elections Will Affect Scrap Prices
Report Date: 10/19/22
Going into the fourth quarter, we’ll see a lot of questions, primarily until the midterm elections are sorted out. On top of that, everyone continues to talk about recession, recession, recession, and that will lead to a massive decline in the confidence of the markets. Metals are going to follow the confidence of the market. If many people don’t think that enormous growth will happen, we will not see reasonable prices going into 2023.
Traditionally, the fourth quarter is one of the slower quarters, especially in December. When companies take profits off the books and executives start to pull back on their plans going into the holidays, we generally see the markets having a pullback. This year we expect nothing different; if anything, we expect it to be a little harsher than it usually would be. With the prices at a relatively strong level right now, we expect to see a further decrease going into 2023.
Non-Ferrous News for Scrap Prices
As much as we like to be optimistic, we do not see 2023 being a banner year for the Scrap markets. We see massive callbacks due to political pressures, recessionary fears, and a sharp decline in the amount of money printed in 2020 and 2021. All these things have snapback effects, and it looks like 2023 will be one of those years with little to no growth.
Ferrous News for Scrap Prices
Steel markets next year are going to decrease in overall pricing. We’re not going to see a strong market on the iron side of things, primarily due to a lack of consumption and overall industry growth. Over the last five years, the massive expansion of products and buildings has grown the market as a whole. Going into 2023, there doesn’t seem to be massive real estate expansions on the commercial side of things compared to the residential side of things. Even if large buildings are going up, many people are retrofitting older buildings instead of using new steel to create new structures.
On top of this, you must look at the auto industry converting many of its parts from steel to aluminum, knowing that it will also affect many markets.
Catalytic Converter Prices & Market Status
2021 showed that many auto industries were growing their production lines because people were interested in more cars. As fuel prices increase and electric vehicles increase, we see a weaning demand for catalytic converter material compared to the past. Even as the United States and many parts of the world transition from traditional combustion engines to electric vehicles, the vehicles that are being produced now will need higher miles per gallon and fewer carbon emissions, which could lead to more precious metals going into the catalytic converters.
Increased precious metals in the catalytic converters will mean that the prices could go up, especially as the war continues between Russia and Ukraine, as Russia produces many of the precious metals used in the catalytic converter markets. We expect the catalytic converter market to grow in pricing throughout 2023 as opposed to some other markets that look to have a decrease.
10-Day Price Lock for Catalytic Converters
For a price lock of 10 days, don’t hesitate to contact RRCats.com Team to get a better idea of catalytic converter markets and free shipping on OEM cats.
This Week’s Summary
The fourth quarter will not be one that people will remember fondly compared to quarters in the past. But we still expect to have very stable prices going into the holiday season, and stability is a very good thing regarding the scrap market. For many of you holding materials, you may be keeping them for a very long time as 2023 may not be as kind to you as you want it to be and you may see continued decreasing metal prices overall.
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