Week in review

Despite tight supply, the ferrous scrap market has largely been stable. In July, most prices were reported as sideways. Consensus seems to be there will be little increase in supply heading into August.

As RMU noted earlier this week, “The trade is of the opinion there is not that much scrap being generated at this point. There will be no increase in the supply of scrap going into August regardless of the grade. In fact, industrial scrap generation appears to be slipping. The flow of shredder feed is not going to increase. Prices for all these grades decreased over the last several months due to meager demand by the mills. However, the general feeling is that demand will improve, and prices will have to move up in August.”

On the non-ferrous side, despite a bleak outlook, the situation remains unchanged. Spreads are still tight, and supply is still said to be short. Sources are saying that mills are mostly full through August. While supplies are still on the schedule for inbound delivery, mills remain strict with their processes, allowing no flexibility. If you’re late or miss your appointment, it’s the back of the line for you (i.e. reassigned to the end of August).

Looking ahead, the Federal Reserve is scheduled to meet Tuesday and Wednesday. With officials poised to lower borrowing costs this year (likely in September), eyes will be on this meeting for any signs of the central bank’s plan going forward.

Recent economic data looks good. The U.S. economy grew by more than expected in the second quarter. GDP rose at a 2.8% annualized rate from April to June. Consumer spending – the economy’s key growth driver – gained 2.3%. Inflation rose 2.9% but is still easing.

Stay tuned for the latest on how these developments could impact the recycled metals market.

U.S. economic reports this week to keep an eye on (EST):