What is Happening Out There?
What is happening with the scrap metal prices? what is causing them to be at lows not seen since February? Will, there be an improvement over the coming weeks? These are just some of the questions that are being asked and we will try our best to give some clarification on what is happening.
What is happening with the scrap metal prices?
To the scrap industry and people that sell scrap, it will be no breaking news to hear that the prices aren't where they ideally need to be. Prices which had seen a great start to the year have now mainly dropped to lows not seen since February. At the time of writing the LME was showing;
Copper - (Highest) $6570 - (Current) $6006 That's a loss of -8%
Lead - (Highest) $2153 - (Current) $1766 That's a loss of -18%
Aluminium - (Highest) $1922 - (Current) $1791 That's a loss of -6.8%
Steel - (Highest) $335 - (Current) $292 That's a loss of -12%
Those numbers from the LME show just how hard the scrap metal prices have been hit over the last few weeks. The losses are taken from the yearly highs which were in February.
What is causing these plummeting prices?
Political unrest between the USA and Iran is escalating this week with talks of military action and us citizens being removed from Iran for safety issues. Military action is extremely costly, not good for anyone's business (except weaponry manufacturers) and it is surely a key factor in what is happening to the prices.
Oil prices had an alarming 2% climb yesterday as several attacks on oil tankers in the Persian Gulf. Drones were also attacking pumping stations in Saudi Arabia. Both incidents were linked to the tensions with Iran and are causing panic in the markets.
The ongoing trade negotiations fell a bit flat this week when China said it would hike tariffs on $60bn (£46bn) of US exports. This caused a lot of panic on the stock markets and caused them to tumble.
Trump is ordering an increase in tariffs for some $200bn worth of Chinese goods. With the G20 in Japan coming in June everyone is hoping that further tariffs can be suspended before China retaliate with their own.
Will there be any improvement in the coming weeks?
The short answer is........no. Unfortunately, further drops are coming this week and going into next week. I would also hazard a guess that the China-US talks won't get resolved until (if they ever do) until the G20 at the end of June and this will likely not allow for much growth as we approach the Summer months.