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This is the Scrap Metal Commodities Recycling and Economic Report, by BENLEE and Raleigh and Goldsboro Recycling, March 5th, 2018. Last week, commodity prices and economic reports were mixed and new U.S, tariffs were announced.
U.S steel production rose and continues slightly ahead of last year and well ahead of two years ago.
Oil rose about $1.00/barrel to $64.37, remaining near the multiyear high it hit a couple of months ago on good global demand and supply.
U.S. oil production hit a new all-time high as OPEC continues to keep their production down, causing prices to be somewhat high. High prices allow U.S. oil producers to continue expanding.
Iron ore rose $1.00 to $80.00, near a high for the year on good global demand, balanced with good global supply.
Scrap ferrous prices were steady, and unless there is a change, many believe prices will be up this week as demand remains solid.
Hot dipped galvanized steel remained at $960/Ton, near its multiyear high on good demand. New tariffs could have this up soon.
Copper fell 10 cents to $3.13 as we move to using May COMEX. While down, copper remains near December’s multiyear high. Copper is down a penny this morning to $3.12.
The 5 year chart shows copper slightly off last December’s multi-year high.
Copper inventories fell slightly on a good balance of supply and demand.
Aluminum was mostly no change to 97.7 cents, remaining near the multiyear high of two months ago on good global demand and supply. New tariffs could change this.
Aluminum LME inventories after their recent rise, remained near about an 8 year low on a good balance of supply and demand.
President Trump announced a 25% tariff on imported Steel and 10% on aluminum. This will support U.S. steel and aluminum makers and hurt many countries, with the top 10 for steel in order are Canada, Brazil, South Korea, Mexico, Russia, Turkey, Japan, Taiwan, Germany and India, with China at number 11 at about 2% of imports. If tariffs happen as announced, finished goods prices will rise close to the 25 and 10%. It is not clear what effect this will have on scrap prices, due to as an example some U.S. scrap that went to Canada, could stay here in the U.S., so no next change in demand.
China’s manufacturing purchasing Managers index fell to 50.3 in February down 1 point from January, the largest fall in more than 6 years. The growth in output and new orders slowed, but business confidence and raw materials on hand decreased.
U.S. February vehicles sales fell to annualized 17.08M from 17.16M in January. While 17M is a great number, sales have softened in recent months.
February’s U.S. Manufacturing Purchasing Managers index jumped to 60.8, the highest growth since March 2004, about 18 years ago amid stronger business conditions and faster job creation, while new orders and production eased a bit. Printing and primary metals grew the most, while apparel and furniture fell. Overall a great performance.
U.S. initial unemployment claims fell to 210,000, the lowest number since 1969, almost 50 years ago. Great economic news.
Wall Street had another turbulent week with the DOW ending down 772 to 24,538, with markets nervous about the steel and aluminum tariffs.
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