Wilson Metal Recycling
Metal Commodities and Recycling Report
June 15, 2015
404 Maury St. S. Wilson, NC 27893
252-243-3586
This
is the Commodities and Recycling report, brought to you by BENLEE the industry
leader in roll off trailers and open top scrap trailers, as well as Raleigh and
Goldsboro Metal Recycling, the leaders in North Carolina for Scrap Metal,
Cardboard, Electronics and Junk Cars.
Today
is Monday, June 15, 2015. My name is
Greg Brown, President and CEO of the companies.
Overall
while the global economy continues its slow steady growth, China which is a key
driver for commodity pricing, continues to be very weak in scrap metal
consumption. This weakness along with
the uneasiness with the financial debt problems in Greece, brought another
problematic week for commodities.
Steel Production
Steel production had a nice little uptick
last week and is up for the past few weeks, but it is still well below last
year.
Oil Rig Count
One of the reasons for this low steel
production in the U.S. is that the Oil rig count has now fallen for 27 weeks in
a row, and is now at the lowest point in almost 5 years. Related, imported finished steel remains a
problem for U.S. steel mills, thereby hurting their production. As has been reported, scrap yards have been experiencing
multi year lows of incoming scrap coming into their yards, so prices rose a bit
two weeks ago, which the chart shows.
Steel Prices
Even with this ferrous increase, scrap flows
remain very, very weak, as do profits.
Scrap yards that have mainly retail business remain under enormous profit
pressure due to this low volume. If the
low growth continues in steel production, we could see another small increase
in scrap steel prices due to the poor incoming scrap steel rate. We know of one steel mill that stayed open
this past Saturday in hopes of securing more incoming ferrous metal, due to the
incoming scrap was so slow.
Copper Prices
Copper prices touched a three month low this morning and they remain near their
5 year low. We see no catalyst that will
cause an increase in copper prices anytime soon. As we have discussed, China consumes 50% of
the world’s copper and China is clearly not increasing their consumption. The China slowdown has caused their
government to drop interest rates multiple times in recent months to boost
their economy and as we go to press, they may have dropped them again today.
Aluminum Prices
Aluminum dropped a bit this week and is close
to the 5+ year low it hit about a year ago.
We remain in the belief that aluminum prices are near their bottom due
to aluminum inventories are hitting new 5+ year lows.
Aluminum Inventory
With energy prices down in the past year,
aluminum recycling is less of a driver, so again, there is little reason to
believe aluminum prices will be coming up soon.
Congratulations
to our David Gibb for being named one of the CFOs of the year in the Raleigh
area. Well done in a very tough market
and well done in teaming with Fifth Third Bank in supporting our operations in
these tough markets. And more
congratulations to Upstate Shredding and Columbus Recycling as they were both
named Scrap companies of the year in their category by AMM.
Prices
for Aluminum and copper were unchanged last week in Raleigh, Goldsboro and
Wilson.
Steel
and Junk cars we up. Please call us at
919-828-5426 in Raleigh, 919-731-5600 in Goldsboro and 252-243-3586 in Wilson
for prices.
With
that we hope all have a Safe and Profitable week. Tune in next week for the Commodity and Recycling
report.
This
is the Commodities and Recycling report, brought to you by BENLEE the industry
leader in roll off trailers and open top scrap trailers, as well as Raleigh and
Goldsboro Metal Recycling, the leaders in North Carolina for Scrap Metal,
Cardboard, Electronics and Junk Cars.
Today
is Monday, June 15, 2015. My name is
Greg Brown, President and CEO of the companies.
Overall
while the global economy continues its slow steady growth, China which is a key
driver for commodity pricing, continues to be very weak in scrap metal
consumption. This weakness along with
the uneasiness with the financial debt problems in Greece, brought another
problematic week for commodities.
 |
| Steel Production |
Steel production had a nice little uptick
last week and is up for the past few weeks, but it is still well below last
year.
 |
| Oil Rig Count |
One of the reasons for this low steel
production in the U.S. is that the Oil rig count has now fallen for 27 weeks in
a row, and is now at the lowest point in almost 5 years. Related, imported finished steel remains a
problem for U.S. steel mills, thereby hurting their production. As has been reported, scrap yards have been experiencing
multi year lows of incoming scrap coming into their yards, so prices rose a bit
two weeks ago, which the chart shows.
 |
| Steel Prices |
Even with this ferrous increase, scrap flows
remain very, very weak, as do profits.
Scrap yards that have mainly retail business remain under enormous profit
pressure due to this low volume. If the
low growth continues in steel production, we could see another small increase
in scrap steel prices due to the poor incoming scrap steel rate. We know of one steel mill that stayed open
this past Saturday in hopes of securing more incoming ferrous metal, due to the
incoming scrap was so slow.
 |
| Copper Prices |
Copper prices touched a three month low this morning and they remain near their
5 year low. We see no catalyst that will
cause an increase in copper prices anytime soon. As we have discussed, China consumes 50% of
the world’s copper and China is clearly not increasing their consumption. The China slowdown has caused their
government to drop interest rates multiple times in recent months to boost
their economy and as we go to press, they may have dropped them again today.
 |
| Aluminum Prices |
Aluminum dropped a bit this week and is close
to the 5+ year low it hit about a year ago.
We remain in the belief that aluminum prices are near their bottom due
to aluminum inventories are hitting new 5+ year lows.
 |
| Aluminum Inventory |
With energy prices down in the past year,
aluminum recycling is less of a driver, so again, there is little reason to
believe aluminum prices will be coming up soon.
Congratulations
to our David Gibb for being named one of the CFOs of the year in the Raleigh
area. Well done in a very tough market
and well done in teaming with Fifth Third Bank in supporting our operations in
these tough markets. And more
congratulations to Upstate Shredding and Columbus Recycling as they were both
named Scrap companies of the year in their category by AMM.
Prices
for Aluminum and copper were unchanged last week in Raleigh, Goldsboro and
Wilson.
Steel
and Junk cars we up. Please call us at
919-828-5426 in Raleigh, 919-731-5600 in Goldsboro and 252-243-3586 in Wilson
for prices.
With
that we hope all have a Safe and Profitable week. Tune in next week for the Commodity and Recycling
report.
