Selling the scrap of multiple businesses at once.

While doing scrap runs i´ve noticed most of the smaller scrapyards have the containers of one particular scrap yard giant. That giant is exporting all the scrap to their plants in China, Europe and US. Now what i understand is global metal prices are determined by London Metal Exchange prices. Now comparing the giants buy prices to the LME, the global prices seem to be around quarter to third higher for non ferrous metals. Question is why wouldnt the smaller metal recyclers export their product for higher yeld. Now i contacted the giant and they offer a bit of a helping hand should I decide to open my own scrap yard. They can provide me with weigh bridge, containers, machinery to make your business opening a bit easier. In turn you´ll have to sell to them exclusively. Now turns out main concern for those smaller businesses is if they dont sell to this giant then this giant wont buy their ferrous metals either so i would have to find buyers for all their metals.



Now i´ve been doing some research but its quite difficult to find out the actual global scrap trading prices. When i contact buyers they wanna see photos of my stock or they wont talk to me about prices at all. If LME prices is what scrap is traded for globally then i see an opportunity to help these smaller scrap yards to export their stock for better prices. I´ve done some import trades but have no exporting experience. But i can see those scrap yards losing money selling to this local giant. those smaller scrap yards accumulate less than a 40ft container of any non ferrous metal in a year so it makes sence for them to sell smaller quantities few times a year to this giant for cash on the spot. What im thinking is i could get together multiple companies to sell at once as soon as they can collectively fill a 40ft container. I have all ready built up good relationships with some companies but dont want to make a fool out of myself when presenting my offer.

So my questions are:

1. How do i know what the actual prices for scrap are. I wouldnt want to go offering $1200 per metric ton of aluminium if i end up getting a deal for only $1000.
2. As of 23. of april LME aluminium price is $1473.50 and if I manage to sell at $1400 I assume buyer would organise and pay for shipping?
3. How can i make sure of actually getting paid for the shipment? I dont think i could convince anyone to pay upfront for the whole shipment while im doing my first export. And it would suck to sell all the copper of say 3 scrap yards and end up getting $0 for it. I´ve been offered LME prices and bank quarantee for payment but i could probably photoshop 5 of these papers in an hour and make it look legit so i dont put much trust in such things. Or is it reasonable to expect full payment before shipping my first container?

Most of the scrap yards are owned by older generation gentleman. As i live in Eastern European country their second language is Russian not English. That means they´d have difficulties communicating with global buyers. You can probably see my grammar not being flawless yet its way over the average over here which gives me an advantage over the scrap yard owners. And our people in general are closed and prefer to keep to their inner circles so not too many scrap yard owners would go to their competitors to make a deal. In the last 10 years i have only lived a year in my home country and being abroad i learned to communicate more openly to different people. Im a pretty good salesman so im confident i could get these business owners to agree to my deal as long as theres $$$ in it for them.

If you are confident and a global expert of things, why ask us?

It's just a thought:

There are traveling scrap brokers out there. I think i would try to become an apprentice to one of those scrap brokers. It would be a good way to learn the business and make trusted contacts all over the world.

Know what every business deal on the planet needs to make it go better?



I have included a picture of one, with proper stocking instructions:



I have included a brief translation: Лучший способ охлаждать напитки в холодильнике.

Thank me later, when you've become a multi-millionaire and a legend in the world of scrap metal deals.

I prefer beer as my thank you.

Good luck!

Sirscrapalot - Хранитель путевого кулера.

I'll drink a few an make it lighter for you.



Sirscrapalot - Buy you a round of Corona? - Said nobody ever after 2020.

I think that even the bigger operations we see, are just tiny specks in the worlds metal markets.

The scrapyards near me, theres only one beside a railway siding, the others must fill trucks & take them to the wharf to unload it i guess.
They fill up slowly, in the case of the one that takes cars, it takes months, maybe 6 months & then pretty much overnight they crush them into cubes & they dissapear.
Even the one by the rail yard, months of steel buildup & gone in a day.

Nonferrous goes into a shipping container, so thats not really noticed by me. But even a whole years worth of Copper for me is just a gaylords full.
Thats tiny to a scrapyard, remarkable only in the sense that somebody there will mention it during a smoko break, only because i sold a whole years worth in one day.

I can imagine that a scrapyard might put together a shipping container of Copper #2 every month.
That goes to the broker/big scrapyard that the public hasn't access to.
They sell it to a broker to fullfill a contract.
And that buyer buys 10 containers full a day.

The average, or above average scrapper simply does not fit in anywhere except as a single scrapper.
Better money is going to involve contract$ & unless you have a dedicated ample consistent source of scrap then you wont get contracts.
The best one could do is to save up & once you have, say 500 Kgs call your scrapyard & tell them & ask "for a better price on it". And once they are nearly filling their shipping container they will call you & offer a better price.
But you better have exactly what you said you had, or better.
The advantages to the scrapyard that will get you the better price is.
1/ They didnt have to fork out their $$ a month ago to buy your scrap back then, better $ management.
2/ They can fill their order quicker & get their $$ quicker.
3/ Somewhere somebodys just fullfilled their contract. Happy buyers make better customers.
4/ Theres just a few days between getting their $$ & you getting yours. And its one of their bigger $$ individual buys. Not 30 individual buys from 30 customers with a big bucket full of Copper.
Ie, one sale, not 30, & just when they needed it & their load went out the door while their $$ returned a few days later.

Originally Posted by eesakiwi

I think that even the bigger operations we see, are just tiny specks in the worlds metal markets.

The scrapyards near me, theres only one beside a railway siding, the others must fill trucks & take them to the wharf to unload it i guess.
They fill up slowly, in the case of the one that takes cars, it takes months, maybe 6 months & then pretty much overnight they crush them into cubes & they dissapear.
Even the one by the rail yard, months of steel buildup & gone in a day.

Nonferrous goes into a shipping container, so thats not really noticed by me. But even a whole years worth of Copper for me is just a gaylords full.
Thats tiny to a scrapyard, remarkable only in the sense that somebody there will mention it during a smoko break, only because i sold a whole years worth in one day.

I can imagine that a scrapyard might put together a shipping container of Copper #2 every month.
That goes to the broker/big scrapyard that the public hasn't access to.
They sell it to a broker to fullfill a contract.
And that buyer buys 10 containers full a day.

The average, or above average scrapper simply does not fit in anywhere except as a single scrapper.
Better money is going to involve contract$ & unless you have a dedicated ample consistent source of scrap then you wont get contracts.
The best one could do is to save up & once you have, say 500 Kgs call your scrapyard & tell them & ask "for a better price on it". And once they are nearly filling their shipping container they will call you & offer a better price.
But you better have exactly what you said you had, or better.
The advantages to the scrapyard that will get you the better price is.
1/ They didnt have to fork out their $$ a month ago to buy your scrap back then, better $ management.
2/ They can fill their order quicker & get their $$ quicker.
3/ Somewhere somebodys just fullfilled their contract. Happy buyers make better customers.
4/ Theres just a few days between getting their $$ & you getting yours. And its one of their bigger $$ individual buys. Not 30 individual buys from 30 customers with a big bucket full of Copper.
Ie, one sale, not 30, & just when they needed it & their load went out the door while their $$ returned a few days later.

I have news for you. The scrap yard I sell to seems to have a tractor trailer or two there any time I go. They have a pile of steel and Al thirty feet high and are pounding it into trucks, and I know of another 6?, probably more within ten miles that are doing the same thing.