Ferrous scrap flows a big concern for 2013

Dec 31, 2012 | 07:00 PM | Sean Davidson

Tags  ferrous scrap, scrap flows, 2013 outlook, Sean Davidson

Many of the ferrous scrap industry’s concerns for 2013 align with those any business owner, employee, retiree, student or unemployed person might have about the economy.

The outcome of debates over foreign and domestic policies, regulations and controls, and taxes and benefits affect everyone, no matter the economy. These are much-discussed universal uncertainties that the ferrous scrap market cannot avoid. But only time will reveal how they will impact the industry, so market participants asked to take a peek into 2013 chose to focus their attention on the issues that directly affect them.

Obsolete scrap flows into shredders as well as nonshredding yards emerged as a prevailing concern--not so much on volume, but quite heavily on margins. Supply flows are directly affected by economic activity, but given a status quo 2012, suppliers say processing margins will come under increased pressure.

From a supply perspective, most participants surveyed by AMM predicted flows will equal those recorded in 2012, or possibly trek a bit higher. Only a few suggested flows could tighten this year.

The supply of used appliances this year is expected to trend at 2012 levels because, according to one source, “generally replacement of an appliance isn’t an elective decision.”....