‘Easy to be uneasy’

Given the disconnect between pricing for some types of nonferrous scrap and market fundamentals, a Midwest-based nonferrous scrap processor says, “It’s easy to be uneasy about nonferrous scrap.” He adds, “It seems like pricing doesn’t always correlate with the fundamentals.”

Another scrap processor who also is based in the Midwest says the market is experiencing its typical summer slowdown. While he says the first quarter of 2017 was better than that of 2016, he adds, “it seems that volumes are spotty [and] based on rallies.”

The first processor says the summer doldrums are typical, but he feels that sluggishness has become more pervasive in nonferrous scrap markets regardless of season.

The second processor describes the copper, aluminum, brass and lead scrap markets as being steady, adding, “[We] have no problem getting sales that are not contract-based.”

While the first processor says brass mills are purchasing bare bright copper scrap in July, he worries such purchasing may not be sustained.

The processor also points to the uncertainty that has developed surrounding China’s imports of certain scrap materials.

During a call with the media June 14, 2017, Institute of Scrap Recycling Industries (ISRI) President Robin Wiener said beyond China’s National Sword campaign, new concerns surround an April 18, 2017, report in Chinese media that the central government had approved expanding an existing list of scrap or discarded materials that cannot enter the country.

Rumors attached to that report have touched on mixed metals, wire and cable. However, Wiener said no specific commodities had been identified for banning as of mid-June.

As an operator of a wire chopping line, the first Midwest-based processor says China’s actions could be good for his company.

“One product going to China that domestic wire choppers are reluctant to process is wire from ASR (auto shredder residue),” he says, adding that trade of this material has slowed in the last six months in response to China’s National Sword campaign. However, his company has the technology and the know-how to process this material, the processor says. “[National Sword] has created opportunities for us.”