So…it’s been a while since you loaded your truck, trailer, or car with scrap steel and drove to the scrap yard. You know that this load that you have is heavy because there were a lot of small nails, screws, and tiny parts that you really packaged together and packed in tightly, so you are driving extra slow and cautiously.
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The Rough Road Of Steel Scrap Prices
You arrive at your local yard and get ready to sell the material that you have. You weigh up on the scale, unload your material into dumping hoppers, a larger pile of steel, or whatever type of bin your scrap yard uses, and return to the scale to weigh out.
WOW! You had 4480 pounds of Light Iron in the truck and are already spending that money in your head. You should be getting what? At least $400-500 will help with your upcoming vacation, and you couldn’t be more excited.
You get to the ticket counter, show your driver’s license, and get handed your money. You are SO EXCITED that you don’t even count it because you want to get it into your pocket and drive home. Then something happens….you get home and look at the receipt, and there is only $90 there…there must be some mistake, but you read the receipt twice, and it says that light iron is $45 per ton….now you’re VERY confused.
Why Are Scrap Steel Prices So Low?
Well, you are probably confused, and because of that, you will have to figure out what happened. Did the scrap yard rob you of your hard-earned work? Is there a mistake? Let’s figure this whole thing out.
We Are Seeing Multi-Year Lows
At the beginning of 2016, scrap steel and iron prices reached multi-year lows, and some markets were even lower than in 2008 when the overall markets collapsed. The overall global demand for metals has dipped way down. Because of that, we have seen copper prices and steel, aluminum, stainless, and almost all other metal prices decrease significantly. The market is in a large flux right now, and because of the world’s supply and demand for raw materials, there is not much room for people to see prices going up anytime soon.
Oil Prices Are Affecting Many Industries, Including Scrap
The markets are in limbo, and because of that, the scrap prices of steel and iron will continue to be low. One good indicator is the oil price; the low oil prices have affected so many different industries that you will be very hard-pressed to see the market increase anytime soon.
Until the oil prices level out, the overseas market needs an increased supply because of shortages of raw materials, and even the Presidential Election will be a factor in where the markets are headed. 2016 is expected to be a challenging year for steel and iron pricing in the market, and because of that, you shouldn’t be too surprised when you see steel prices remain low.
Suggested Reading: If Oil Prices Go Up, Will Scrap Prices Go Up Too?
Thoughts on Increasing Profit?
- Shop around for prices through the iScrap App. Here, you can find up-to-date prices and prices other people have received from their local scrap yards.
- Look for more scrap..with the prices so low, there should be more scrap out there to pick up. A lot of the part-time scrappers will give up for the time being, and this will be the time for you to be able to capitalize.
- Ask your scrap yard for a dumpster. Some yards may have extra dumpsters you could get dropped off at a job site or your house. Now you can put more material into it and increase your profits even more.
- Try to sort and separate your material more. Maybe items with electric motors inside will suddenly be worth taking apart.
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Suggested Reading: 5 Ways To Eliminate Frustrations of A Dropping Scrap Metal Market
