Common Questions About Scrap Prices
Since opening iScrap back in 2010, we have been asked all types of questions, including:
- Why doesn’t my local scrap yard have the same prices I see online?
- Why don’t scrap yards pay the same price I see on iScrap?
These are all great questions, and we will explore why prices on iScrap are different from those in your scrap yard.
The iScrap App was founded by a scrap yard owner who wanted to create more transparency in an industry that is usually very hush-hush about prices. Initially, many posted prices were based on our founder’s scrap yard and Local and National price knowledge. Over the years, as the internet has made more information more accessible, we have used multiple price ranges reporting prices across the United States and Canada to create the National Price Averages listed through the iScrap App.
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Where Do Scrap Prices Come From?
While you always see dozens of prices in different materials updated daily, knowing where these prices come from is very important. Since 2017, when scrappers began posting some of the prices they received from their local scrap yards online, we’ve been able to take that information compiled in spreadsheets to help create National Price Averages. On top of that, the team at the iScrap App has been able to work with other scrap yards to learn more about their prices in different markets throughout the country as well. Scrap yards generally look to the internet to learn about the markets, including where copper prices and iron ore prices are trading.
Suggested Reading: Factors That Determine Scrap Prices
At iScrap, we aim to interpret the markets’ movements and translate them into realistic scrap price ranges you will find at your local yards.
Compare It To Gasoline Prices for Your Cars
You’ll see things through the commodities trading world, including crude oil pricing. The actual price per gallon for gas is not a traded number, making it much more difficult to understand the relation between the price per gallon and the trading prices. Comparing gas prices per gallon to the scrap market gives you a better idea of where many national price scrap averages come from.
Suggested Reading: Why Do Oil Prices Affect Scrap Prices?
How Are Scrap Prices Determined?
All companies have a profit margin that they are comfortable with and need to be able to pay for their overhead. Once you have that basic idea, you can move on to the next step to help figure out how scrap prices are determined. Some larger scrap yards or suppliers look to buy from smaller scrap yards or even medium-size companies. Large companies, such as mills or furnaces, base their global trading numbers on their prices.
Most prices are based on recovering precious metals, whether copper, Lead, or any other type of material. Those recovery percentages help determine the scrap prices and how different scrap yards can start setting their prices for scrappers at the door.
How Scrap Yards Choose Their Prices & What Materials To Buy
Some scrap yards do not buy all materials, while others buy everything under the sun. There are multiple reasons why different scrap yards choose or don’t buy different materials. We want to discuss some of the different reasons to give you a better idea and learn about different things.
Size of Property
The size of the property on which your scrap yard is located is one of the biggest factors in whether or not it will buy different materials. Some scrap yards operate out of buildings and do not have any outdoor space, which would limit their ability to buy steel, process cars, or have any larger ferrous operations. Larger operations generally need more space for more equipment, allowing them to buy bulkier items.
Legal Requirements
Some towns do not allow specific work permits, so some scrap yards cannot have significant operations. There are also different legal requirements inside of different municipalities, both local and state-run, that could limit different scrap yards from doing different things.
In addition to those different restrictions, there are also different legal restrictions about permits, applications, recordkeeping, and dozens of other things that restrict scrap yards from doing all types of recycling and instead only focusing on one or two different types.
We hope this gives you a better idea of how scrap yards operate and where some prices come from. This can help you determine where to sell your scrap and who to sell it to. We implore you to continue to follow the National Price Page Averages while learning about the scrap market.
