Augest Scrap Prices Review
Summer is coming to an end, and the leaves have started to turn. This marks the sign of the end of the year fastly approaching and what can be for the scrap metal industry the slowest time of year.
Before we talk about the final four months of 2019, let's have a look back across August to see what has been happening, why it has been happening and what is in store for the remainder of the year.
The copper market started at one of it's highest points since mid-June but soon began to fall. The price started the month at $5875 before dropping to $5646 the prize then proceeded to bounce around for the rest of the month before ending at $5721. That is a drop across the month of 2.6%.
The aluminium market started the month of August at not far off its lowest point of 2019. $1756 a tonne was the starting point before a slight climb midway through the month before finally dropping off to its final price of $1712 a tonne. That is a drop of 2.5% by the end of the month.
Not following suit the lead market brought some positive news. The lead prices suffered a massive drop in May but since then has made a considerable recovery. August started at $1973 at tonne before a steady climb across the month until it reached $2038. That is an impressive climb of 3.3%
When looking at a graph of the steel price, you ideally want to see a gentle upward slope. Not too many of those in recent times. What we are looking at across August is more like a downward staircase. This trend has been pretty much the same across the year since the end of January. The month opened at $289 before the steady climb down toward the end of the month and a price of $282. That's a drop of 2.4% across August.
What Is Happening Out There?
Trump has been tweeting again and has been encouraging business not to trade with China. This comes as no surprise as the lack of trade deals that looked so promising several months ago is only going to lead to more aggressive stances on both sides.
These tweets almost instantly put a dent in the stock market and the copper prices. Which subsequently had a resounding effect on the other metals as China were solely responsible for taking in approximately 50% of the world's scrap. Now if the Americans are being encouraged not to sell to the Chinese, then I can't see an end to this any time soon. Some say a bad thing, but it could be seen as a good thing for the American scrap industry.
In the long term, such a move would allow for the domestic scrap market to flourish as well as opening up new trade routes. In a short time though we are going to have to settle with an unstable market and low prices.
Where is the Market Headed?
As we head into September and everyone is back from their Summer breaks, there is likely to be an increase in the copper prices and the steel prices. Expected to be short-lived, but any positive movement will be welcomed in the current scrap market.
With Brexit picking up steam again on the approach to the October and the threat of a general election. I doubt there is going to be much positive movement across the industry as all businesses start to batten down the hatches until the 31st of October.