Scrap You Later

Calm Markets: Smooth Sailing From Here? - 7/7/21

July 07, 2021 iScrap App Episode 45
Scrap You Later
Calm Markets: Smooth Sailing From Here? - 7/7/21
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Scrap You Later
Calm Markets: Smooth Sailing From Here? - 7/7/21
Jul 07, 2021 Episode 45
iScrap App

Even after the long 4th of July holiday, the markets have stayed relatively calm, with little movement from copper, steel, and aluminum. How is oil affecting all this? Find out in this week's Weekly Report episode.

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Show Notes Transcript

Even after the long 4th of July holiday, the markets have stayed relatively calm, with little movement from copper, steel, and aluminum. How is oil affecting all this? Find out in this week's Weekly Report episode.

📲Download The App

✌️
Become A Patron


Support the show (https://www.patreon.com/iscrapapp)

Tom Buechel:

iScrappers, Tom from the iScrap App. And today is Wednesday, July 7 2021. And we are so excited that you're joining us. You haven't joined us before, well, welcome to the party. This party is all about scrap metals, different economic things at affect scrap and metals, we try to twist it all together, put it in a bow, package it so you make more money with your scrap. Now, if you haven't joined us before, and you're looking to make more money and learn more about not only the scrap metal markets, you know, one of the things that we've tried to push, we're not just talking about scrap, we're talking about the markets in an economic sense, that gives you a better idea from gas prices to oil to trading to different political factors that will affect the metal prices. And by taking all of these things, and putting them into some of our exclusive Patreon content. By becoming a Patreon supporter, you're going to give yourself the ability not only to make more money by learning about the markets, but we are going to send you weekly and sometimes daily tips that help you know what's going on. So if you haven't become a Patreon supporter today, it gives us the ability to make more content for you to scrapper. Now, over the last week, we want to wish you a very happy Fourth of July, and we hope you had a nice holiday weekend, we saw leading up to the holiday weekend was a real nice solid push. Although we did see oil prices topping $75 a barrel for the first time in six years. And a couple of the economists that I was listening to just earlier this morning and some podcasts that I listened to, if you want to listen to our podcast, scrap you later, we'll post a link on here. So you can follow us through the apple podcast or with the Spotify store. But one of the podcasts that I was listening to was talking about two different very interesting and market impacting effects. The first one was the oil prices. And they are predicting not $100 per barrel by the end of the year, which would be about a 35% increase, but about a 15-20% increase with oil prices between $85-$90 per barrel by the end of this year. And what does that mean to you and what that means to scrap? Well to you, it's going to cost more money to put gas in your car to put diesel in your truck. So that's just an easy black and white type of an answer. But what it also is going to do, it's going to drive some of these prices up. And what we could see happen is what happened about a month ago, the Chinese saw the copper prices really pumping their way up, they injected a bunch of copper into the market by injecting the the metals into the market. They lowered the prices supply and demand people this is going back to your your economic 101 days, maybe back in high school talking about supply and demand. The Chinese saw that we needed more that they didn't want their consumers or themselves to be spending so much money on the scrap coming in, they pushed a bunch of copper into the market. And that is exactly what could happen with the iron market. Although it's a little more unstable and not as predictable with that, because of the value, you know, inside of 100,000 square foot value, you could potentially have a billion dollars worth of copper ingots, instead of that same footprint, you will not have a billion dollars worth of steel, you might only have 1,000,002 million $5 million worth of steel. And that's a really big factor because the iron ore that's coming out of places like in South America, in Australia, it's big, its bulky. And what does that mean? It takes up space. Copper is also big and bulky. But you can deal with something that's worth 10 times as much as steel is because the value is there opposed to the steel value. So when we're looking at those two things, we're looking at the prices of oil and how expensive it's going to be for barges to move things across the ocean. Which brings us into our second point, barges and freight freight prices right now are going to become astronomical. And what we're hoping happens is that the US government gets their off of their high horse let some of the oil producers inside of the country go back to what they were doing in the previous administration, pumping oil breaking shale producing gasoline and oil inside of the country, which kept those prices so low for so many years. I listened to the economist this morning and they said that by the end of the year. The oil that's produced in the country along with the reserves here in the United States, we are going to be because the demand of people going back to work driving more cars and not taking public transit, that oil demand is going to go up. That's why the used car market is booming. That's why the new car market is having a problem, because they can't get those microchips in fast enough the semiconductors to sell those new cars. So they're really struggling overall. And these prices, if they continue to go up, and the current administration doesn't allow shale producers or pipeline people to go back into the oil producing business, and continues to do this crazy, EV push so fast with with not a lot of infrastructure in place, you will continue to see oil prices going up, you will continue to pay more at the pump. I don't mean to scare you up. But I'm telling you what is happening. I mean, this is a news. I heard this morning that they're expecting that by the end of July, gasoline prices are going to go from a $3.11 average towards $3.30. That's crazy. And we are going to outpace the amount of oil that we produce in the country. And what does that mean? And how does it relate to scrap? If we're using more oil every day inside of the continental United States, then we need where we're going to get the rest. We're going to get it from OPEC, we're going to get it from the group in the Middle East, which means we will go within one year from being a net exporter of fossil fuels, to a importer of fossil fuels, and we will no longer have energy dominance, energy independence, scrap prices will go up but so well the prices of lots of other stuff. And we like to highlight these things because when you ask are scrap prices going to go up, we always watch those oil markets and watching the oil markets. While not all roads lead to Rome, oil markets do lead to a very good indicator of where different other commodities are gonna go. Because you don't have EV trucks moving material back and forth. You have oil and gasoline and should make gasoline and diesel trucks, moving things, trains, moving lots and lots of material generally not powered by the sun, powered by coal. So all of these different fossil fuels are needed. And the more expensive it becomes, the more expensive scrap could become. Unless we have more influx and like more material getting pushed into the market, like the copper did the iron prices, we thought we were gonna see a $30-$40 drop this month per ton. After a quick reversal. I think we're going to be about even maybe down $10 per ton on the steel side of things. So things like shred light iron, cast iron, we're gonna see those prices hovering where they are, we're a national average for light iron is in the $170 range. Right now. We're seeing unprepared steel for like PNS between $265 and $305. We're seeing some bushing numbers in the $350 range. We're seeing shred numbers directly to shredding facilities between $202-$230 and by using the iScrap and especially with the new 2.0 that we have coming out I know we keep teasing it, but we don't want to release it until it's ready. And you can see behind me we have a screenshot of it and with our new iScrap App 2.0 you're going to have the ability to follow market trends better report prices easier view prices that have been reported and learn more about these different market trends and how you can help yourself make more money because that's what we talk about. How do we help you make more money with your scrap we got a question on the topic so let's get right to it.

Missy Quinn:

Can coax cable be sold a shred/white goods? Also how much plastic is too much for the shredder?

Tom Buechel:

Yeah, so when you deal with coax cable and for those of you that don't know or are not familiar with coax it's generally that white or black cord that comes from the black the back of the TVs it has that number you go to screw it in has that little sticky thing it always stuck into your finger and you're trying to get it on there with that little x screw. It's generally copper coated on steel, some scrap yards don't want it at all and you really are going to want to talk to your scrap yard for multiple reasons. If your scrap yard is also a shredding facility, the plastic that goes into the shred pile even though about 2/3 of that co x is steel weight and 1/3 is plastic. What happens is the plastic mixed in if it's in a big bundle, think of it like gum, right? If you took gum from your your mouth through it onto the 90 degree floor and stepped on it what's going to

Missy Quinn:

Would it be worth it to buy a cordless angle happen? Well, it's really easy. The gum was warm from your mouth, the floor is warm, your foot is going to press down on it, and it's going to become gummy. By becoming gummy and sticking to your foot, it's really hard to get it off. Think about that when it comes to the coax when it's mixed in with a different shred or steal rates. And it goes into the shredder, if you have big bundles of this stuff, it's going to become gummy inside of the shredding facility. And if you don't know what a shredding facility looks like, if you've ever seen a paper shredder, put a piece of paper inside, if it goes right through, think of that as steel. And we might do a video on this just to be a little playful. Now take a piece of gum, put it on that piece of paper and try to get it to go through the shredder, we'll probably make this video and we'll probably destroy a shredder. And that's the point of the video. When you take this product and just throw it into the shred pile, your shredder that you work with might not know that it came from you. But ultimately, you could cause a lot of problems. Number one concern that I would have would be safety because now guys have to go in, you got to kill power shut things off climbing into, you know, a shredding facility with those, those shredders going back and forth with all their sharp teeth on grinder and carry it in my vehicle? So I can dismantle their people who get hurt, equipment could get damaged, all for a couple of bucks. So talk to your scrap yards in advance some scrap yards that we've talked to will take it in, but they'll put it into gaylords. Or they'll even bundle it up. So when it goes to get refined, it's just coax getting refined. I know a guy out in Ohio right now that's holding about 1.2 million pounds of coax and maybe he's moved in the last month ince I talked to him. But it's enerally cheaper than steel items on the curb? Would it pay for itself eventually? ecause the plastic so hopefully hat helps. We had a follow up uestion.

Tom Buechel:

Yeah, so I mean, it's an awesome tool number one. So I think that every tool pays for itself eventually, as long as you're getting a fair amount of use out of it. Now I don't like working on the curb for a couple of different reasons. If you're doing different residential pickups and you've in you see whether the town is doing a cleanup, and you only want the motor out of something. If I think about if someone pulled up to your house, you put your garbage because that's what it is to the homeowners, you put your garbage out on the curb. All of a sudden, you look out and there's this guy who you don't know we're girl in a pickup truck with a tool making sparks all over the place. I don't know about you. Even if I knew who that guy was, I don't want him making sparks all over the place in my front yard. So while the angle grinders an awesome tool, you might want to throw the scrap in your vehicle and take it apart back at your garage or house wherever you process scrap just to help make you a little safer. And while that might not be the perfect answer, a shortcut might be having a big pair of loppers, and we've talked about loppers before, the longer that the handles are, the more the what's the word that I'm looking for, the more the more leverage that you have to cut something in half. So like a two and a half foot pair of loppers, and we'll throw a link on there from ones that we recommend off of Amazon. By buying those you'll be able to find them and you'll be able to use those cut something to maybe cut it apart with a grinder later on. One idea though, because we are giving away tools right now we're giving away the wall tools from saws, awesome blades and drill bits and drills if you come either a copper or a aluminum level Patreon supporter so if you're looking for free tools, and you're looking for the ability to learn more about the scrap market by becoming an aluminum or a copper supporter of ours through our Patreon account, you'll be able to get access and hopefully get some nice new tools that you can make more money with your scrap. We always try to drift towards corded tools, especially if you're doing a lot of dismantling at your garage. Number one, you're not gonna have a battery that dies even if you're charging batteries. It means that you need to stop what you're doing and kind of do a hot swap switch those batteries out and if you're doing something that takes a lot of juice, I mean, think about cutting apart an electric motor. If you have a grinder with a battery, you might be able to cut one or two or five apart. But once you get into the 10th that battery's going to burn itself out because the power that's being sucked out of it and if you're doing a lot of motors you have if you don't have 15 batteries, five batteries, a lot of batteries. You're going to spend more time so we'd like those courted options that give you unlimited power. Almost Another question.

Missy Quinn:

Should silver coated brass be kept separate from uncoated brass?

Tom Buechel:

Yes and no. Silver coated brass is worth more money than regular brass. I mean, why wouldn't it be you have silver on top of something. But if you don't have thousands of pounds of it, you're not going to be able to get more money from your scrap yard. I know here at Rockaway Recycling in the past, we've tried separating silver coated products. And what we've found is it took us two, three months just to be able to get enough product to get it refined. And here was the problem, we saved about 4000 pounds of yellow brass, I don't remember the price. Let's just go with today's prices with a national average, hovering around two bucks. It cost us $1,000 to take that silver coated brass and store it in another box. things that could happen, the market could go down. Now that extra money that we were going to make off of the silver will be negated by the market falling, it takes six weeks to get paid. So once we save it for you know eight to 10 weeks and ship it out. It could be a total of 14 to 16 weeks until we see the money and how much more we're going to get. So your local scrapyard. If they're not sorting and separating it on their own, you're going to have little to no chance to do it by yourself. But if you do have a lot of it, please message us here at the I scrap app. And maybe we can help you learn where even buy it from yourselves. Now let's talk about copper. Copper prices in the last week relatively steady. Yesterday was a little crazy. I woke up around four o'clock looked at the market, it was up 11 cents ago. Hot Dog, what a great way to start the short work week after a holiday having copper prices climb. And then the market opened at 9:30am. And copper went from 11 cents up to 8 cents to four cents to two cents, and ended the day negative. This morning I woke up the market was up 6 cents. Now it's up about 5 cents. But we haven't seen a crazy fluctuating market right now, which is what we want. You know, we talked about that a few weeks ago, copper dropped 50 cents in one week. That's frickin bananas. That's not what we want. When scrapyard get hurt. And believe it or not whether or not you care about your scrap yards. When you have a 50 cent swing, they're going to get hurt. When they get hurt. They're going to go from being an aggressive buyer to a less aggressive buyer because they need to make up for what they just got hit on. And they're not going to know week to week what if there's another 50 cent drop and your scrap yards holding 150,000 pounds of copper in a two week period of time with back to back 50 cent drops. That's like $100-$150 grand that they could lose. And while I know that scrap yards do have bigger pockets because of the commodity prices right now, no scrap yard is in any, you know situation where they're ever going to be okay with losing six figures, $100-150 grand. So these large copper fluctuations, they really screwed scrap yards up because they didn't know what to do the next week. And because of that, it really made it tough for that second and third week after large price drops to really stabilize the markets. And we saw that through the reported prices that were online, those market prices dipped down really, really quick. And our national averages went down really really quick because the scrap yards got so less aggressive on the pricing side of things that it affected things in a completely new and different way that you couldn't have thought about. Now let's talk about aluminum. Aluminum prices really, really strong sheet aluminum markets: $0.45-$0.55 cents a pound for mixed grades and aluminum sheets. I saw bare aluminum 6063 prices reported from scrap yard at 87 cents a pound. Wow, that's an awesome price and one that shouldn't be ignored. The aluminum market still not only has tariffs in place, but we also have a demand that isn't going to too long. So when we look at these demands, it could continue to go for a while. And overall these markets are so strong right now, if you're saving, cash it in, there's no reason not to. And if you were a Patreon supporter, you probably would have received a few tips from us over the last few weeks like many of our supporters have given them advice on what to do with their markets and with their metals. Catalytic converters markets have been relatively common here RRCats. om If you're looking for quotes, you can always Reach out to the team to get quotes from serial numbers, pictures and know that you will be like thousands of other people getting paid quickly, efficiently and creating a transparent process has been one of the things that the team at RRCats has done. Now scrappers, today is Wednesday, July 7 2021. We love your ideas. Thank you for the questions, your comments during the weeks, your emails and for tuning in to our podcast, scrappy later. If you're looking to learn more about scrap every week, we have two to three episodes coming out ranging from five to 15-20 minutes, teaching you about the market talking about stories and we love to hear your opinion on it. Today is Wednesday, July 7 2021. We wish you a happy day. Scrap often stay healthy until next week scrappers I'll scrap you later.