Demolition executives see signs of a pickup in actitivy and slow replenishment of the heavy melting scrap pool

Jul 01, 2010 | 09:50 AM | Michael Marley

Demolition contractors aren't sitting on a mountain of unsold metal and while signs of a pickup in business are beginning to emerge, on a flat hill an uptick doesn't necessarily amount to much.

The demolition industry, which provides cut plate and structural scrap and heavy melt to scrap processors and steel mills, has hit bottom and is now beginning a slow rebound, but the recovery is unlikely to be very dramatic, according to Drew Lammers, vice president of the demolition arm of Cohen Brothers Inc., a Middletown, Ohio-based scrap processor, and a past president of the National Demolition Association (NDA). "It is now starting a slow uptick, but that hill is very flat. It is a slow uptick."

The tight credit market means developers are having a hard time getting money to tear down old buildings and construct new facilities, so any material from demolished buildings is turned around immediately. "We turn it over as soon we demolish it because we build into our price the value of that scrap. (It) is very important to cash flow and the overall bottom line to the demolition contractor's business," Lammers said.....