New Year Begins with High Prices

Scrap metal collectors and dealers are cautiously optimistic as the first full week of 2010 begins with higher prices for salvage and recyclable metals.  A sampling of our own new higher prices indicate brisk demand for scrap metals.

Beginning Monday, January 4, 2010, Stubblefield Salvage and Recycling, LLC at 980 NE Myra Road in Walla Walla, Washington will pay $2.22 per pound for bright and shiny copper and $2.16 per pound for number one copper.  Red and yellow brass follow closely at $1.39 and $1.31 per pound respectively.

Number one plate and structural steel, as well as number two prepared and unprepared iron are also worth slightly more with higher prices ranging between $70 and $120 per ton for less than 20-ton truck loads (LTL).  Vendors with single loads weighing more than 20 tons should call for special pricing; material inspection may be necessary.

These New Year prices are in sharp contrast to the stock market free fall during the last few days of 2009 and may yet impact scrap metal commodities.  The higher prices offered for scrap metal do not make practical sense when compared to climbing world metal inventories.  In fact, common sense would usually indicate that scrap dealers should actually lower prices.  Still recycling used metals costs less than mining ore for new resources.

Global investors, on the other hand, are searching for anything safer than paper, whether it be money, bonds, stocks or dried ink on parchment or fabric.  To some, the touch and feel of hard, raw materials --even land-- may be more attractive as they wonder if the next big bubble is about to burst.  Their worries are valid and basic to a real and sustainable economic recovery.

Three of their top most concerns are:

1) Small business growth: the number one provider of new jobs in the United States economy.

2) Bank lending: the traditional source of funds for business growth and large consumer purchases.

3) Government corruption and cronyism: systemic and institutional trust; fundamental to all transactions.

In my next blog, I will begin to address these issues as they relate to the metal processing and recycling industry and the US economy.