If you’re interested in making some extra cash by selling scrap that you collect, you’re likely wondering how much it’s worth. Doing even a small amount of research will show you how quickly prices change – in some cases, it could even be on an hourly basis! So, what exactly causes this volatile shift in scrap metal prices? In this blog, we have taken a closer look at the 7 main factors affecting prices around the country.
- Importation Costs
Did you know that Australia actually imports scrap from other countries? Some businesses also seek assistance with melting down and processing from international companies who are better equipped to handle these processes. The processed metal is then sent back to Australia where it is sold onto manufacturers. As such, the price is directly affected by how much it costs the recycler to import the materials into the country.
- Local Issues
Keep in mind that prices can also change due to various local issues – from those that affect the whole state to those that affect just the city you live in. These issues could include increases in fuel prices, scrap yards competing with each other, and whether the yard exports their metal out to be refined or not. This is why it’s important that you do your research and find a yard that ticks all your boxes.
- Mining Industry
Did you know that there’s a direct connection between scrap metal prices and the mining industry? Generally speaking, using recycled material has lower expenses and energy consumption when compared with mining raw ore. When miners find lower quantities of certain ores, the only option is to turn to recycled ones. This makes scrap even more valuable, which means that you – as the seller – stand to make a lot more.
- Processing Costs
Recycling scrap involves more than 2 steps. Once it’s been gathered, metal must go through a series of processes to ensure it’s ready for recycling. It’s important to ensure that everything moves smoothly to avoid disrupting the supply chain. Any disruptions can prove to be costly to the recycler. Each process requires special equipment and at least a handful of staff – all of this combined will affect the end cost.
- Quality and Quantity
Keep in mind that whatever scrap you try selling will be tested against quality standards, which allow for the segregation of metals that are usable by foundries, mills, smelters and so on. If you have high quality items in large volumes, you can rest assured that you will make the most out of the transaction. You’ll be even more successful if the items you have are ones that are in high demand, like copper and iron.
- Supply versus Demand
As with any product, scrap prices ultimately depend on demand for that particular metal. There are a couple of industries – like technology, transportation and construction – where materials are constantly required, but even they have slow periods and extended periods where demand is incredibly high. In short, the higher the demand for a particular type of scrap, the costlier it gets. So sell when demand is high.
- Time of Year
Another factor that can affect the cost of metal is the time of year, which is also directly related to demand. During the warmer months, for example, demand tends to be high as the construction industry typically sees an influx of work. Therefore, worksites need more materials. As such, the price of scrap increases over the summer with every construction business trying to get their hands on as much as possible.
At the end of the day, there is no clear and precise way to tell scrap metal prices without going to visit a recycling yard. However, by taking a closer look at each of the 7 factors we’ve outlined above, rest assured that you’ll have an idea of how much you’ll be able to get for your scrap. If you’re interested in selling metal that you no longer use, be sure to reach out to the team at Highett Metal – we are committed to safely and ethically recycling all sorts of materials.
