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Scrap Monster

Scrap Metal & Commodities Recycling Report July 10, 2017

This is the Scrap Metal, Commodities, Recycling and Economic Report, by BENLEE and Raleigh and Goldsboro Recycling, July 10th, 2017. In the last two weeks many commodity prices rose and economic reports were positive. U.S steel production remained in a tight range and is about where it has been for the past two years in July.

After weeks of falling, oil moved up for about two weeks, but dropped late in the week to 44.25 a barrel. As the U.S. continues to increase production, we are actually increasing oil exports. Crazy industry. We buy oil from the Middle East, but we export oil to China.

The oil rig count rose to 763. With prices down from the recent high, the weekly increase in rigs has slowed, but it is still increasing. The good news is 763 is still 53% lower than it was a few years ago so there is huge upside.

Iron ore continues is recent rise and closed at $63.50, which will put upward pressure on finished steel prices in the weeks to come.

Scrap ferrous prices remained steady. July prices have not been totally set yet, but the initial reports are that prices will be mostly no change, with premium grades up a bit. There are multiple reports that flows into scrap yards have slowed for some grades of material, which could create upward price pressure in the weeks to come.

Hot dipped galvanized steel remained lower at $865/ton, with little news. Automotive markets remain down a bit as other market remain strong.

Stainless 304 scrap stayed at their lower level of 29.5 cents. There remains little news to move the Stainless markets.

Copper after a solid rise two weeks ago, fell ending at $2.65/lb. on no major news. The U.S. dollar has been weaker in recent months which takes commodity prices up. Prices are down a bit this morning to $2.63.

The one year chart shows copper prices have remained in a band in recent months since the major increase last year.

Copper inventories have increased in recent weeks. As inventory rises, this puts downward pressure on prices.

Aluminum inventories hit yet new about 9 year lows on this good demand, which is keeping upward pressure on prices.

U.S. vehicle sales decreased in June to an annual rate of 16.51M, from May’s 16.66M, the lowest level in over three years. While still strong, sales are being depressed due to higher interest rates and the continued increases in student debt. Related vehicles last much longer.

The Ford F150 which has a complete aluminum exterior saw it sales rise a huge 28% in June over last year. It remains the best-selling car or truck in the U.S. and sold an amazing 43% ahead of its main competitor the GM Silverado last month. As has been said, in the coming years, aluminum intensive vehicles will dramatically increase the amount of Aluminum that comes out of car shredders.

Non-farm payroll jobs increased a solid 220,000 last month with healthcare adding 37,000 jobs, followed by professional and business services adding 35,000. The mining and drilling industry added a light 8,000 jobs.

Even with this good growth, the unemployment rate ticked up to 4.4 percent, higher than last month’s 16 year low of 4.3 percent. This is good news in that it shows people that had stopped looking for jobs are entering the workforce, which will make it easier to find workers.

Many are concerned about numbers like the low 4.4 percent meaning it will be tough to find workers. That remains why we like to show the labor participation rate, which is people that are 16 years or older that could have jobs, do in fact have jobs. It is currently 62.8, so about 37 percent of people that could work are not working. We need to get more of these people working.

Wall Street had a rocky week, but hit a new high during the week and ended at 21,414. Many think that the Transportation average which also hit a new all-time, is an indicator of more positive things to come, due to if airlines and shipping companies are strong, the economy is strong.

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

Courtesy : www.benlee.com

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