2015 Scrap Prices • Year in Review
It has been a turbulent year in the scrap business. Many of you ask, ‘What’s going on with the prices?’ There is no way to just pinpoint one reason. Several factors play into the decline in prices we’ve experienced throughout 2015. Through some investigation and fact finding, I’ve come across a few things that have contributed; although, I don’t have all the answers.
The U.S. dollar has been valued very high. The exchange rate is powerful and caused several steel companies to use the open global market. Importing steel was a good deal for them. This in turn hurts our domestic demand for the steel needed by mills. Go back a couple decades, and the “global” conversation was not as prevalent. The steel market was taking care of itself domestically.
Steel production has declined at a pretty high rate this year. A small uptick was seen this past month due to less steel imports, higher automotive production, and a continued slow growth in the economy. Below is a graph showing raw steel production over the last three years.
Steel production decline has shown correlation with scrap metal recycling prices. Below are averages for mill direct scrap purchase prices. It was not an impressive year as sharp declines were seen several times.
Not only did the scrap steel market get hit, but many recyclable non-ferrous metal prices also showed some declines. Demand for non-ferrous metals was not very strong throughout the year. Following are some snapshots of the past five years for aluminum and copper spot prices.
Like I said at the start, I can’t pinpoint any specific reason for the decline, but hopefully this gives you a bit of an insight to the scrap market for the past year. I’d like to say thank you for your business in 2015. If you have any questions about getting your scrap recycled, please call us at 712-476-4500.