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Scrap markets short on supply: exec

Keywords: Tags  North American scrap, scrap supply, Scepter, Garney B. Scott, Aluminum Association, Michael Cowden

FARMINGTON, Pa. — North American scrap markets are "very, very tight" as large inventories of scrap have dried up, according to one industry executive.

"Fields of scrapped cars have already been crushed and shredded, buildings have been dismantled and shredded and recycled, and companies that generate scrap as part of their manufacturing process have become efficient," said Garney B. Scott, president of Scepter Inc., a Waverly, Tenn., secondary aluminum recycling and trading company.

As a result, less scrap is available at the same time that less is being generated, Scott said, and scrap items that traditionally had been consumed by secondaries are now being shredded, cleaned up and sent directly to mills. "There is lots of capacity built to support a secondary aluminum industry that is looking for raw material inputs that are nonexistent," he said during a press roundtable Oct. 9 at the Aluminum Association’s fall meeting in Farmington, Pa.

U.S. and Canadian scrap imports this year have increased slightly from 2012, albeit by a negligible amount, while exports have dropped by roughly 325 million pounds, Scott said, but the market is still under pressure, even with less scrap leaving the country and 90 percent of vehicles being recycled.

"A lot of pressure is on these plants to find more sources, which just don’t exist," Scott said. But companies still need to produce. "And to make the product, you are having to use primary aluminum. That’s the result," he said.

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