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For the week beginning Monday, January 9th

In the absence of major economic news, commodity prices got off to a slow start this week with base metal prices flat to weaker in Shanghai and mixed in London. At the LME this morning, official 3-mo. copper eased to $7,508/mt while zinc firmed to $1,868/mt and official 3-mo. aluminum advanced to $2,079.50/mt, rising above $2,100/mt in afternoon trading, Reuters reports. In New York, COMEX Marchcopper was off 1% late this morning to just under $3.40/lb. while crude oil and gold futures softened below $101/bbl and $1,615/to, respectively. On Wall Street, stocks lacked direction as the Dow Industrials opened in positive territory but pulled back later in the morning. In currency markets, the Euro rebounded from a low of $1.2675 this morning to over $1.273 while the Swiss Franc climbed higher following the announced resignation of the Swiss National Bank chairman.

As the political and earnings seasons in the U.S. heat up, we’ll have new numbers this week on retail sales, consumer confidence, inventories and trade. Trade numbers also come out in China this week, along with the latest Chinese inflation data. Also, French and German leaders are scheduled to meet today, while the World Economic Forum releases its Global Risks 2012 report this week. We’ll take a look at the this week’s economic, commodity and scrap market highlights, including the latest U.S. scrapexport data for November, in this week’s Friday Report.

Guest Blogger: Mark Perry, Carpe Diem Blog

http://mjperry.blogspot.com/

Rail Traffic Ends the Year With Strong Gains
"The Association of American Railroads (AAR) today reported gains in 2011 rail traffic compared with last  year, with U.S. railroads originating 15.2 million carloads, up 2.2 percent over 2010 and up 9.7 percent over 2009. Total U.S. rail intermodal volume in 2011 was 11.9 million trailers and containers, up 5.4 percent over 2010 and up 20.4 percent over 2009.

In 2011, 14 of the 20 carload commodity categories tracked by AAR saw increases on U.S. railroads compared with 2010 indicating a broad recovery across industry sectors. The largest gains were: metallic ores, up 20.5 percent or 67,631 carloads; primary metal products, up 12 percent or 56,988 carloads; and petroleum products, up 11.1 percent or 36,811 carloads.

“A good beginning, some uncertainness in the middle, and then a good ending—that describes U.S. rail traffic in 2011,” remarked John Gray, AAR’s Senior Vice President for Policy and Economics. “We continue to see hopeful economic signs, as the industry prepares for 2012.”

AAR also announced gains in December 2011 rail traffic, with U.S. railroads originating 1,134,580 carloads, up 7.3 percent over December 2010, which is the largest year-over-year monthly increase since January 2011. U.S. rail intermodal originations totaled 873,390 containers and trailers, up 9.4 percent over December 2010. This is the second-highest monthly intermodal average for any December in history. During December 2011, 16 of the 20 carload commodity categories tracked by the AAR saw

increases compared with December 2010."

MP: The materials moving daily around the country by rail are the "raw ingredients" (coal, grains, chemicals, lumber, minerals, paper, iron, steel, etc.) of American industry that are being delivered to a company, factory or plant somewhere in the U.S. for the next stage of processing. The annual gains in the volume of those raw materials being shipped by rail last year and the ongoing monthly gains in rail traffic, reflect the gradual recovery taking place in the U.S. economy, especially in the manufacturing sector. Increases in orders for the inputs delivered by rail in 2011 will translate into increases in final output (GDP) this year, which could also contribute to greater job growth in 2012.

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ISRI Spec of the Week: From ISRI’s Scrap Specifications Circular 2011, Guidelines for Nonferrous

Scrap:Scroll UNSORTED ZINC DIE CAST SCRAP Produced from automobile fragmentizers. Material to contain about 55% zinc-bearing scrap. Other nonferrous metals such as aluminum, stainless steel, red metal, etc., to be about 40%. Insulated copper wire about 1%. Trash, dirt, glass, rubber, oil, iron, not to exceed 5%. Any variations to be sold by special arrangement between buyer and seller.

Monday’s Quote: “I am a man of fixed and unbending principles, the first of which is to be flexible at all times.” -- Everett Dirksen