[5/18/22] Weekly HOLD or SELL

HOLD OR SELL NON-FERROUS
HOLD OR SELL FERROUS

Yowza!!!

In the wild world of scrap, we have seen all types of news in the most recent weeks. We have seen the continued market sell-off for steel and iron, and extreme gas prices and we even started to see copper prices coming back.

Now, your question is probably along the lines of, “what’s going on?” Well, you can get in line right behind us because we’re certainly trying to figure this out after a day. As different economic numbers come out across the world, one thing that we are seeing lifting a lot of the market is the return to work in Beijing and in other areas of China. 
 
Not having millions of people working, believe it or not, causes a large dent in the commodities market for as we have started to see people in China returning to work this is starting to turn itself around.

Non-Ferrous Prices & Market Status

  • Copper – SELL

  • Aluminum – SELL

  • Brass – HOLD 

  • Copper Wire – SELL

  • Stainless Steel – SELL

Copper prices look to have a future, demand is high as Elon Musks’ ambitions to the stars. With so much electrification going on throughout the world and getting ready to go on in the next hundred years everyone’s favorite red metal will be on display. I was listening to an economist recently who talked about where the future is going to be and how that’s going to affect the commodities markets. 
 
If you think about basic vehicles for years automakers heavily relied on steel and aluminum but with copper quickly becoming one of the larger needs in the electrification of the auto industry, we expect to see the red metal stabilize and excel over the next few years. Well, there will always be months that cause short-term price decreases, but overall it looks like we are going to be in a very strong market for a long time.
 
Now, on top of copper having high demand, so will aluminum. One of the things that we’ve seen in the aluminum markets is a lot of interest rates and how other countries have been shipping material. One thing that you may not think about is the interest rate hike that you may have heard of in the last couple of weeks. These interest rate hikes increase the value of the US dollar by taking more US dollars out of circulation, when that happens commodities will become devalued because there will be more value in the US dollar than certain metals. This is one of the major factors why we saw the aluminum markets decreasing over the last few weeks, in addition to other commodities.
 

Non-Ferrous Price Chart of the Week- Copper

 

Ferrous Prices & Market Status

  • #1 Steel – HOLD 

  • Shreddable Steel –SELL

  • Light Iron – SELL

  • Cast Iron – HOLD

  • Complete Car – HOLD 

If you look at the last statement in the last paragraph that will also pertain to many of the steel prices. We saw such a quick run-up of the markets over a three-month window that now we are starting to see those markets unravel a bit. We never want to tell you that we told you so, but with markets that went up that quickly; we generally will see a rapid decrease downward and that’s one of the reasons why we like to tell everyone to hold or sell different materials from week to week. 
 
On top of that, you have continuing record-high diesel prices and that is affecting the trucking industry which is moving much of the Scrap. Even though many large commercial barges will be loaded and shipped overseas, that doesn’t mean that oil and diesel, and gasoline or not continue to be used. In fact, many of these barges are loaded after hundreds of trucks dump material off at certain ports and large equipment moves these pieces of steel multiple times, and all of these touches create larger costs.

Ferrous Price Chart of the Week

Catalytic Converter Prices & Market Status

  • Catalytic Converters – SELL

We have seen a strong comeback in the PGM market over the last two weeks. We have seen about a 7% increase across-the-board for all three metals making up this category. One of the reasons has been more sanctions pushed on Russia, which would limit the amount of palladium coming out of there and increase the value of recycled palladium that’s already out in the market.
 
Overall, these markets are still very strong and we suggest getting a free quote from the team at www.RRCats.com, to figure out the value of your cat and with free shipping for all OEM units, you’ll be able to know what you’re going to be paid. 
 

Other Metal Markets

In other markets, looking across the entire spectrum right now has everything that seems to be affecting everything else. One example that we could point to is the consumer price index which shows that people have continued to spend money every single month this year and a little more than the months prior.
 
That means that even with the recession and inflation looming, people are still spending money on many pent-up demands, goods, and services. These are very important factors when it comes to driving commodity prices as consumer demand for things like new cars, new houses, or anything else that you can visualize. These are the things that will lead to price increases and sustained commodity prices moving forward. 

Thank You. We hope that you’re continuing to enjoy our videos and are weekly reports and we look forward to hearing any and all comments.

We have a couple of videos and podcasts that feature some interviews with family inside the Scrap business and with Scrappers. If you’re looking to be featured, interviewed, or even interview any of the people at iScrap, let us know so we can get it together.

– Tom

 


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