Metal Commodities and Recycling Report, Wilson Metal Recycling, 404 Maury St S, Wilson, NC, 27893, 252-243-3586

Wilson Metal Recycling Metal Commodities and Recycling ReportApril 27th, 2015404 Maury St SWilson, 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, April 27^th, 2015.  My name is Greg Brown, President and CEO of the companies.

Last week while there was some very bad news, we saw some stabilization in the commodities markets which is a clear positive.

As expected, Steel Dynamics released their earnings last week and said that OmniSource, the country’s second largest recycler, lost money in the first quarter.  Related, Nucor Steel released that their recycling division’s profit declined.  Nucor also released that their DRI plant in Louisiana, that makes a scrap steel substitute, was back on line in recent weeks.  This plant back on line is just another factor in keeping scrap steel prices low. 

AMM - Scrap Metal Prices Graph

There has been stabilization of the euro vs. the dollar, but with the euro at about $1.08 to the dollar, this is still a major incentive to have scrap metal and finished goods steel, flow into the U.S. from Europe.

The low euro along with dynamics such as the continuing decline in the oil rig count, continue to put pressure on steel production and prices.
Last week the oil rig count fell for the 20^th week in a row.  At the current 704 rigs, it is 56% below last October’s high of 1,609.
 
 

Baker Hughes - US Oil Rig Count Graph

Oil, though, is now up about 18% from the lows of a few months ago, so this rapid oil rig decline should be slowing soon.
 On the positive side, with auto production strong and with construction in the U.S. getting a bit better, steel production is off its lows. 
 

AMM - Steel Production Graph

Copper had some highs and lows last week, but remains in a range for the past 6 weeks and is about $2.76 per pound this morning.
 

CME Group - Copper Prices Graph

Aluminum traded in a similar way last week and is about where it was two months ago.

Kitco - Aluminum Prices Graph

There were some mixed signals in the economy last week with the government releasing that orders for durable goods were up a nice 4%, but it was mostly due to orders for commercial aircraft.  Behind these numbers was that last month was the 7th month in a row of declines in business investment.  Michael Montgomery of IHS Global Insight said, "The report was yet another false positive that looks good in the headline but is eroding away underneath.

New home sales were released last week and fell more than 11 percent, to 481,000, which was off its recent 7 year high.  Importantly, new home sales are still running less than half its high of over 1 million units in 2006.  Tight lending by banks and enormous student debt are major drags on this market.

Wall Street while somewhat being fueled by leverage of people buying on margin, continues to do very well.  As noted above, while fuel prices are rising, they are still below last year, so we hope the wealth effect of Wall Street, combined with lower fuel prices, will get the economy through some of its soft spots.

It was great to see so many friends, customers and suppliers at the ISRI meeting last week.

There were no changes to our copper prices in North Carolina last week, with our Raleigh prices of #1 copper being purchased for $2.36 per pound.  Prepared Steel is still being purchased for $6.25 per hundred pounds.

With that we hope all have a safe and profitable week. Tune in next week for the Commodities and Recycling Report.

Metal Commodities and Recycling Report, Wilson Metal Recycling, 404 Maury St S, Wilson, NC, 27893, 252-243-3586

Wilson Metal RecyclingMetal Commodities and Recycling Report
March 25th, 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, April 6^th, 2015.  My name is Greg Brown, President and CEO of the companies.

It was a very quiet week in the markets.

Last week as April began, there were few if any trades in steel. 

Steel production remains near its multiyear low, which is a reason that scrap metal demand remains weak. 

  

AMM - Steel Production Graph

With demand low, prices remain steady at their multi-year lows.

AMM - Scrap Metal Prices Graph

With the strong dollar, scrap prices also remain low due to scrap metal imports continue to hit the East Coast.  Related, a few weeks ago Nucor Steel announced that their DRI plant in Louisiana which has been off line since November was due back on line by last week. It is not clear if this happened.  As many know, DRI competes with scrap steel, therefore this will be yet another reason for depressed scrap steel prices. 

The number of oil drilling rigs in the U.S., after hitting a hit of 1,609 in October 2104, fell to 802 last week, which is a 50% plunge from the high, which is also keeping steel prices down.

Baker Hughes - US Oil Rig Count

On the positive side, March car sales which were released last week were up about 1% from a year ago, but at a very high annualized level of 17.1 Million units.

The price of scrap steel for April will be established this week.  With the mixed dynamics we just mentioned, there may be no change in prices on average, with some grades possibly slightly higher and other grades slightly lower.

Copper had a tough week.  It started the week at about $2.80 per pound and steadily declined all week, finishing about $2.74 per pound.

CME Group - Copper Prices Graph

Aluminum had just about the same trend and declined all week, with Kitco spot aluminum finishing the week just above 78 cents.

Kitco - Aluminum Prices Graph

Sadly, nickel prices declined this week, taking stainless steel prices down to lows not seen in years.

The increase in the U.S. dollar vs. the euro remains a key reason for the flood of scrap metal and finished goods coming to the U.S.  The dollar’s strength stabilized last week and reversed a bit, but the flood of imported goods continues.

On another subject, the March U.S. jobs report that was released last week was a very disappointing 126,000, making it the lowest since December 2013.

Bureau of Labor Statistics - Job Market Graph

While bad weather was one of the causes, others believe a new softening economy is a reason.  A growth in high wage jobs remains a major factor in the slow growth economy. Some believe this slow growth, means the fed could further delay the increase in interest rates which is due to happen in the coming months.   Of course slow growth keeps scrap metal prices low.

Our congratulations to Jay Sherwood, formally of Schupan and Sons, for his being recognized this month by the Portage Rotary, for all his great work in the community.

Last week we raised copper prices in North Carolina, with our Raleigh prices of #1 copper being purchased for $2.36 per pound.  Prepared Steel is still being purchased for $6.25 per hundred pounds.

With that we hope all have a Safe and Profitable week.   Tune in next week for the Commodity and Recycling Report.

Metal Commodities and Recycling Report, Wilson Metal Recycling, 404 Maury St S, Wilson, NC, 27893, 252-243-3586

Wilson Metal Recycling

Metal Commodities and Recycling Report

March 25th, 2015

404 Maury St S

Wilson, NC, 27893

252-243-3586

This is the Monday 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, March 30^th, 2015.  My name is Greg Brown, President and CEO of the companies.

It was a quiet week in the markets, other than last Monday

Late afternoon last Monday, copper jumped 10 cents on COMEX and stayed there for a number of hours.  Other than that, copper started and ended the week the same way it started, about $2.78 per pound.  On the negative side of copper, sadly copper and copper alloy scrap exports were down 25 percent this January, year over year. Pic

Also, some will say Copper is a key global economic indicator.  For many years, copper has been called either Dr. Metal, or the metal with a PhD.  The Dr. name is due to many say, the health of the economy can be determined by the price of copper.  The PhD name is for PhDs are smart, so they know what is going on, meaning the price of copper is an indication of the strength of the economy.  Put together, things are ok, but not great.  Copper was about 68% higher in April of 2011, versus today.  It was $4.66 per pound in April 2011 and $2.78 today.

CME Group - Copper Prices Graph

As for steel, for those that missed last week’s report, it’s worth mentioning that about 10 days ago, Steel Dynamics which owns OmniSource the nation’s second largest recycler of metals, issued a profit warning to Wall Street.  They said profits were going to be lower than all had been expecting.  The flood of finished steel coming into the United States from overseas, lower volumes and the lower prices of scrap metal, were the stated reasons.  It was also stated that they would lose money this quarter in Recycling.  Nucor Steel, the second largest steel producer in the United States also issued a profit warning.  They gave the same two reasons as Steel Dynamics and said that their recycling operations would have declining profits.

Related last week there were various meetings in Washington DC with U.S. Senators, the Secretary of Commerce and the U.S Trade representative, to discuss possible dumping of steel into the U.S. from other countries below cost.  As part of this, the President of U.S. Steel has called for congress to act on what he says are these unfair trade practices.

Also, with the new month, steel prices may change this week.  Some say the move could be sideways and there are indications that some prices could be up.  A key issue is, shred feed remains very scarce, due to very low inflows of obsolete scrap.

AMM - Steel Production Graph

On the positive side, after a huge drop in US steel production, we are now seeing a small increase in production levels. 

With that, scrap metal prices remain at their multi year low. 

AMM - Scrap Metal Prices Graph

Aluminum after quite the drop in the past year has stabilized and saw some increases last week.  Many feel very good about the price of Aluminum, as the new Ford F 150 ramps up with its all-aluminum exterior.  Related there is word on the street that Chrysler is about to follow with aluminum exteriors.

AMM - Aluminum Prices Graph

Oil remains a mixed news story.  The oil and gas drilling rig count continues to decline in the United States.

Market Realist - Oil Rig Count Graph

Orders continue to slow down with steel mills making less steel for drilling rigs.  On the positive side as we continue to say, with prices of fuel remaining low, it is starting to have a positive effect on many parts of the economy as people and companies have more money in their pocket.

As for the recycling industry, there is no good news.  Volumes remain low, with margins going up a bit, not due to less competitive pressure, but due to pure math; as prices go down, margin percent goes up.  In reality though, with volumes down, profits are down.

There were no changes in our scrap metal prices last week in North Carolina, with our Raleigh prices of #1 copper being $2.20 per pound, but could go up this week.  Prepared Steel is still being purchased for $6.25 per hundred pounds.

Lastly, our best wished to Jim Lawrence, in his new role at AMM.

With that we hope all have a Safe and Profitable week.   Tune in next week for the Monday Commodity and Recycling report.