COVID-19 and Scrap Prices

[Okeden]

With all the problems being caused by the Corona Virus at the moment and the economic downturn, one would expect scrap prices to take a tumble. And that's exactly what happened.

Between March 5 and March 19, in Queensland we saw a drop of between 15 and 20% in various copper prices. The worst was a 20% drop in domestic copper prices which is probably understandable, but Milberry, the best of all, dropped 15%. Things like plumbers Brass was down 5% and extruded ally down 9% as was lead. But basically not too bad considering.

Checked my emails yesterday afternoon and saw an email from my dealer. I thought this is going to be not nice.

Well I was pleasantly surprised. Everything, except Cu/Br Rads, had gone back up by about a third of what they had come down. And I guess surprisingly, steel is holding very well. But then the price of iron ore is holding fairly well around $90.

So all is not doom and gloom in the scrap business. Even if you can afford to stock pile for a little while, you may be able to keep the dollars flowing. I'm certainly stock piling at the moment, except for complete cars, because I have other income.

And my apologies for not putting up actual prices but I'm reading off my major dealer's price list rather than that of a local scrappy. So like others on this forum I guess I have to keep some things to myself. But anyway, just thought I would try and put some good news on the forum. Cheers

[Okeden]

Gee whizz, perhaps I spoke a bit too early. Within 24 hours I received a new price list. Virtually everything reverted back to the previous prices which weren't to bad, but with some notable exceptions.

Plumbers Brass down 17.6%, extruded ally down 29%. But the big move is in steel. Heavy in size down 15%, heavy over size down 35%, light gauge down 37.7% and car bodies (incomplete) down 46.5%. So it would seem that where possible try to stockpile as best you can. Cheers

[cat]

As we feared. I was feeling slightly positive when I went to my yard on 13th March, and prices were slightly better than at end of January, but have been dreading how they might have slipped since then. I don't have much left anyway. Tried to take down bulkier stuff -as much as I could when I went last.

[Chris]

With the whole planet in turmoil at the moment, I would expect the market will pretty much collapse! I'll be spending the winter organising my yard and stockpiling ready for a rebound (but it may be a long time coming! )

[Okeden]

Yeah Chris I think we are going to see some turbulent times before this is all over. Trouble is people like my mate up here who's business revolves around scrap need to try and keep some money flowing. When this first started and the markets crashed, Iron Ore prices have held fairly steady around the $USD90 mark. Gold collapsed overnight which was quite strange because normally when the stock market crashes Gold goes up. People see gold as a saviour. It has come back quite strongly jumping $USD50 in two consecutive days. As for the $USD well you kinda get giddy watching it.

Of course there are the normal conspiracy theories going around which fit well with what has happened. Like when the gold price collapsed, China was allegedly the big buyer. And of course they were p**d off with the trade deal with America.

But certainly a good time to clean up the yard and stockpile until the good times return. Chris, I know you have a shop to sustain you, and I have a separate income stream, so I hope most of our friends on this forum are not relying on scrap to make a living. As they say, we live in interesting times.

[Chris]

Yeah Bill, interesting times indeed!
My scrap is nothing more than long term savings! I haven't sold any for near 20 years - at least non-ferrous stuff anyway... and I don't buy it at all. Just stack it aside when it turns up!
Yes my main income is my shop.. but as of three days ago, that is closed indefinitely! Until this whole virus thing blows over and the tourists come back! So, no income there!
I am about to crank up ebay to try and generate some cash flow - and also am really starting to work on my youtube channel with the hope that it may generate some dollars at some stage in the future.
I am fortunate that I have enough savings to get by for quite awhile...
Just quietly, I'm actually really enjoying getting into my shed and sorting stuff out that hasn't been touched for years because I'm normally too busy!

[Inner City Recycler]

I'm stockpiling Cu. I'll sell the other stuff if I start tripping over it.

Sims Metal share price has dumped from $10 earlier in the year and is now <$6

[Okeden]

Yeah nothimg else you can do Inner City. Just make sure you sit on the more valuable items like as you said Cu. Brass is another one to keep.

Over the month Milberry is down 15%, Candy down 17%, Burnt down 16% and Domestic down 20%. And Plumbers Brass is down 28%. Strange thing is that commodity prices haven't collapsed. Gold did suffer initially but has bounced back. Iron Ore is still around $USD90, so maybe, in the long run we won't hurt too much.

And you're right about tripping over stuff. I've got 35 acres and I'm tripping over domestic aluminium, so it's going today. I've got about 165 kilo of many used sheet ally and that takes space. Probably got as much or more of extruded but it's down 33% so I'll keep sitting on it. At least it stacks better.

[Chris]

35 acres and you trip over 165kg of aluminium Bill?? 🤣🤣

[Okeden]

Chris, 165kg of sheet aluminium takes up space. And I haven't got it spread over the whole 35 acres. The missus would go berserk. Most of it was from caravan skins so even though you roll it up as best you can, it still takes room. I had 4 x 44 gallon drums stuffed with it, but when you take the roof off a van in one piece and roll it up, it doesn't fit in a 44. Like I said, I would have as much extruded but that packs a lot easier so just stuff it in the drums.

I'm generally quite organized but this material was just getting out of hand. I stripped out 4 vans so you can imagine. My big bulky stuff is organized. I have rainwater tanks, oversize steel like car and caravan chassis as well as some car bodies for crushing, and they are all stacked neatly in their own little paddock.

But I'm going to use this market drop and COVID-19 to clean up my yard and see just what I have got laying around. I know I have plenty of fridge and freezer skins to finish stripping for any Cu tube and the light gauge, which we crush into "bricks". Wish I could cut them apart with the oxy like I do the compressors, but the insulation is a real pain catching fire and then blowing back at you. Just have to persevere with the cutting blade on the angle grinder. Trouble is that grinding is hard on batteries,

Other problem to overcome is irony ally (cast). I have tonnes of it. Need a furnace to melt it in and let the molten ally flow into a 44 of water so that it makes shot like balls. But I could have 6 months to play around with this. Still collecting and stockpiling, can't help myself. Going to Brisbane on Saturday for a few days (business) and have 4 air cons to pick up while I'm there, so good value.

Anyway, have fun, cheers

[Chris]

Your block sounds like my kinda place Bill! I grew up on a cropping farm and in my 20s I had a 20 acre block which actually had a small paddock area for car bodies. I was doing quite a lot of scrap steel back then as a bit of a side line to my mechanics business. Gee, thinking back, I had a lot of cars crushed which would be quite collectable now! This was mid 1980s.
By the way - I wasn't really having a dig at you! Just sounded funny having a pile of aluminium taking up 35 acres!!
So now I have a small yard behind my shop to use (I'm not allowed any scrap stuff at home - which is only a residential block in town anyways).
I do miss having acreage!
After all this virus stuff blows over we will have the neatest scrapyards ever!

[Okeden]

Hey Chris no offence taken mate. When you mentioned it I could certainly see the humour in what I had said. And yes I hope we do have the neatest scrapyards ever. Never know what I'll find in mine. And by the way, for those interested, my new price list for the week shows all prices steady except for batteries which are down 20%. Maybe some hope. Cheers