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Despite transport problems, non-ferrous scrap continues to flow


Non-ferrous metal scrap is circulating well in mid-October, despite transportation issues that continue to plague supply chains in the United States and around the world.

“In general, demand is still very good,” says a marketing manager at a scrap metal processing company that manages post-industrial equipment at multiple locations in the Midwest and Southeast.

He says the spreads have remained constant for aluminum extrusions and other grades of rolling mills over the past few months, although prices have increased. However, the gaps widened for painted coatings and other secondary grades, according to the marketing manager, and demand also increased.

“On the secondary side, things were pretty calm,” he says. “And now it looks like the prices are a little more attractive.”

The shortage of silicon and magnesium increases the demand and price of scrap aluminum with this content, he says.

A vice president of marketing and trade with another Midwest-based multi-site scrap processor said the rise in the price of the A380 common alloy has pushed up scrap prices on the secondary side, despite the issues. Persistent production in the automotive sector linked to the shortage of semiconductors. “We can sell our secondary aluminum, and the prices are pretty decent right now.”

Joel Fogel, executive vice president of nonferrous for Cohen, Middletown, Ohio, also mentions the widening of the gaps for common alloys, such as clips and low copper compound facings. He also notes an increased export interest for this material. “It’s a different dynamic,” says Fogel. “I don’t know if we have seen the global competitiveness in terms of the national number on the aluminum side for several years.”

The marketing manager describes the export demand for scrap aluminum grades such as washers and turnings as “fairly healthy” with good prices.

“We have been very attentive to our export activities recently,” he says, noting that transport bottlenecks require close monitoring. “We have kept in close contact with transport and operations. Everything that needed to be shipped was dispatched on time last week. We thought we had reached a milestone, ”he said in mid-October. “Today, not a single one of the three export loads shipped because we couldn’t get containers.”

While Fogel says aluminum scrap moves well, some primary factories are pushing back deliveries. “You can’t really sell and ship in the same month. “

The marketing manager says he sees demand remaining strong through the end of the year, adding that he sees “no sign of slowing down”.

Fogel says talks about infrastructure investment in the United States and around the world are pushing commodity prices up. This is compounded by “all the supply chain and workforce issues and optimism in the terminal and financial markets,” he adds. “I think it’s a perfect storm; there isn’t a single reason that everything is fine. There are several reasons. Personally, I feel like we might not continue to climb the way we are. But I really see and feel that the markets will remain stable over the next few quarters. “

Demand and prices remain strong for red scrap.

“The market has gone up a bit since the middle of last week, and the spreads haven’t widened, and that tells you something,” said the vice president of the Midwest-based scrap company. “It’s an indicator of strong demand.

“When it comes to copper, the spreads haven’t changed much as the market has increased,” Fogel said, adding that he believes things will become more competitive for scrap copper with capacity additions that have been mentioned in North America.

He says, “I think there will be more demand for secondary type copper in the United States that hasn’t existed.” He adds that this increased demand should make it possible to reduce or maintain spreads.

Spreads began widening on October 19, according to Davis Index, when Comex copper closed at $ 4.71 per pound, an increase of 39 cents per pound from October 12. The information and pricing service adds that many market players expect the copper price from Comex. to reach $ 5 a pound by the end of October.

While Todd Safran of Safran Metals in Chicago says red scrap is flowing freely, high prices are sidelining some consumers. He says some consumers need quick deliveries, while others are one to two months away.

Trucking issues could be contributing to the need for quick deliveries to some copper consumers, he speculates. Profitable trucking is hard to come by, says Safran, although it is generally available. “For the right price, anything can happen. But a bad price can kill a deal pretty quickly.

The vice president of the Midwest-based scrap metal company said domestic and export demand for red scrap remains strong. Because of supply chain issues, he says, “no consumer wants to lose a lot of junk. ”


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