Scrap Metal & Commodities Recycling Report July 31, 2017

This is the Scrap Metal, Commodities, Recycling and Economic Report, by BENLEE and Raleigh and Goldsboro Recycling, July 31st, 2017.

Last week commodity prices were mostly higher and economic reports were positive.

U.S steel production rose to a 4 month high and capacity utilization of steel mills hit a new 2017 high of 76.1 percent, which is great for their profitability. Nucor last week reported they were running at 90%.

The U.S. Dollar decreased to 93.39, a 15 month low which helps increase U.S. exports, and increases prices of commodities which are traded in U.S. Dollars.

Oil rose about $4.00 to $49.57 a barrel on good demand and a sharp fall is U.S. oil inventories. OPEC had targeted reducing shipments to the U.S, to reduce U.S. inventories which are very visible to the markets. They seem to have done that, and prices are up.

The oil rig count rose 2, to 766, as the count continues to increase, but at a slower rate than we have seen in the past year, due to lower oil prices.

Iron ore rose again to $70.50 which is now the highest in a few months, putting upward pressure on finished steel price and scrap prices.

Nucor’s plant that makes DRI, a scrap metal substitute, went off line due to an equipment failure. This will create more demand in the SE for scrap metal, which will put upward pressure on scrap prices.

Scrap ferrous prices remained steady, but export prices have been on the rise. With a weakening U.S. dollar, solid global demand, combined with the Nucor DRI plant off line, this will put upward pressure on scrap steel prices for August.

Hot dipped galvanized steel rose again to $922/ton on good demand and the need to pass on higher raw material costs.

Stainless 304 scrap prices remained steady to 29.5 cents per pound on little news. A weak dollar could put upward pressure on this low price.

Copper rose a huge 16 cents to $2.88 on a weakening dollar and good demand, especially from China. Prices are up a penny this morning to $2.89.

The 5 year chart shows the major run up in the past 8 months and the two year high.

Copper inventories were little changed, but remain near a high for the year and double that of about a year ago, which puts downward pressure on prices.

Aluminum prices were little changed ending at 85.5 cents remaining near a multiyear high. Good global demand and the weaker dollar is putting upward pressure on prices.

Aluminum inventories rose slightly but remain near about 9 year lows on this good demand, also keeping upward pressure on prices.

U.S. Consumer sentiment was raised up to 93.4 in July which while high, it is the lowest since October 2016. Republicans are feeling much better about the future than democrats. Republicans are feeling less optimistic in recent months, so we are seeing this number come down as democrats feel very pessimistic.

The U.S. economy grew by an annualized rate of 2.6% in the second quarter, which was the second highest growth rate in two years. Business equipment investment, nonresidential construction and federal spending were up, with exports and residential investment down.

Caterpillar is an indicator of global commodity markets. They reported a 37 percent increase in profits. They said; “While a number of our end markets remain challenged, construction in China and gas compression in North America were highlights in the quarter. Mining and oil-related activities have come off of recent lows, and we are seeing improving demand for construction in most regions.”

The U.S. Purchasing Managers index rose to 53.2 in July, the highest level in 4 months it is the highest value in four months as output, new orders, employment and stocks of inputs rose faster.

Wall Street continued its 8 plus year almost steady run up as the Dow Jones hit a yet another new high ending at 21,830. These highs are feeding consumer confidence and helping spending.

For those that missed it, BENLEE entered the Lugger business a couple of years ago, by buying Huge Haul, the original lugger company with the original Load Lugger patents. Call us for a quote or to rent one, call Premier Truck Sales!

As always, feel free to call or email me with any questions and we hope all have a Safe and Profitable week.