Why are prices dropping?

Im sure with all the years of experience on this forum, a few of you could help a newbie like me and others with this question. I understand the market fluctuates. But i also know there are times when its known the prices will go down. Ive been reading about prices going down in July since May. Also im reading that prices wont really go up until fall. Im reading this enough to think there has to be some logic behind it all.

There are other reasons at play, a primary one now being China. http://www.scrapmetalforum.com/lets-...html#post88705 Today that news story on stockpiles of Iron was replaced with a nearly identical one about coal

I don't really think china has that big of a part in it. Its more or less our own fault seeing how we have had years of ballooning deficits. Its pretty much **** or get off the pot time in america right now. That fiscal cliff is coming up fast. We either make big cuts to spending or raise the debt ceiling AGAIN. Politics in the this country has come to a stand still and no one wants to do anything about it. I am not a democrat or republican I am for common sense. Common sense would tell you that we can't keep spending money we don't have on things we can't afford. Its time to cut back the fat and trim everything. We can't keep handing out money for nothing. We can't keep fighting wars we can't afford. We can't keep expecting different results by electing the same people. There the ones that got the USA into the is mess to begin with. My grandparents are rolling over in there graves right now seeing how we are dismantling america and scrapping it or shipping the jobs overseas. Makes me want to puke every time i see a politician on TV.

Remember we also export tons of scrap to japan, greece, turkey, brazil, and a bunch of other countries.

Thanks Bear! That link helped Shed some light.

Hallelujah PSP!

PsP said it all. Like PsP I'm of neither party, and I've come to the conclusion as long as we keep voting party lines, and not it what's best for the country and our people, things will just get worse. Republican, democrate...both sides of the same coin. They are out to protect their interests not ours. We see it everyday, if it's not one party throwing a tantrum like a 2 year old it's the other. Both parties need to realize they work for us, not the other way around, nor are they better then us. Supposedly we're all equal..I think some famous paper says that..but eh, what do I know?

It's time to kick the current people out, all of them from both sides. With my company, if I had employee's which i don't..lol..You don't perform to standards your fired. Should be the same for those fat cats in Washington. They are not performing to the standards we the people want, so they gotta go!

Remember this come Nov. Don't vote for the party, vote for what's right for the country and ALL of our people..not just what benefits you. (again..general you..)

I believe the definition of insanity is repeating the same task over and over again and expecting different results..well folks, we're insane..we keep voting the same crooks, liars and scammers into office.

Sirscrapalot - Politician a crook by a different name.

Supply and demand is what drives the price of scrap.

Demand for new steel goes down so does the price of scrap steel. Turkey is the biggest importer of scrap steel right now. They are not producing as much new steel as they were in the past and that is one of the biggest reasons why scrap steel prices have fallen here in the US. US mills also shut down for maintenance during the summer, which in turn means less demand for scrap steel, which means lower prices.

The recent down turn in prices has decreased the flow of scrap into the yards and many suppliers are not willing to sell to mills at the decreased numbers, myself included. The mills will have to raise their buying prices in order to secure enough scrap to fill their needs. I predict that scrap prices will increase between $10 and $40 per gross ton for all scrap grades in August. Let see if I'm right.

PistoneScapProcessing for president!

Supply and demand is corret. Production of goods is down world wide, that means demand is down, that means prices are down and will stay down until prodution goes back up. That won't be till after the elections. my .02

Key while i agree with you that the price will go up next month. I don't think more then a few dollars. There are still sellers in this market this month. They might not be selling much tonnage but they are still gonna make there margins on the material sold. Every scrap yard just lost 100 dollars a ton on there material on the ground in the last two months and everyone knows you need to have cash flow to operate a business especially after taking a hit like that. Granted you made a killing when the price was on its way up but that isn't the point. A 100 a ton is just that a 100 a ton loss that is on your books. When the price is up or down you still need to turn over product in order to keep the doors open. You can't keep stock piling or else some yards will run out of cash and borrowing money isn't something that they like to do especially to pay for inbound material. I know they borrow to pay for equipment, trucks, upgrades, etc. in some cases.

I really doubt you would want me as president because the first thing I would do is order bulldozers to start at one end of every Walmart parking lot and don't stop till its finished and flat ground. I just hate that store and the detrimental effect it has on small businesses in the outlying community and the effect its had on american manufacturing as a whole. Yeah!!!!! We want our cheap throw away Chinese junk and we want it now. Bust out the contaminated toothpaste and drywall. We need jobs not throw away crap. Remember back in the day when america made stuff that lasted and people had jobs and could afford to buy quality made items made by Americans. Sam Walton would fire everyone at that company including his own family if he would see they replaced his american made products on the shelves with whoever can produce the product cheaper then someone else. I gotta go throw up now.

Originally Posted by PistoneScrapProcessing

I don't really think china has that big of a part in it. Its more or less our own fault seeing how we have had years of ballooning deficits. Its pretty much **** or get off the pot time in america right now. That fiscal cliff is coming up fast. We either make big cuts to spending or raise the debt ceiling AGAIN. Politics in the this country has come to a stand still and no one wants to do anything about it. I am not a democrat or republican I am for common sense. Common sense would tell you that we can't keep spending money we don't have on things we can't afford. Its time to cut back the fat and trim everything. We can't keep handing out money for nothing. We can't keep fighting wars we can't afford. We can't keep expecting different results by electing the same people. There the ones that got the USA into the is mess to begin with. My grandparents are rolling over in there graves right now seeing how we are dismantling america and scrapping it or shipping the jobs overseas. Makes me want to puke every time i see a politician on TV.

Remember we also export tons of scrap to japan, greece, turkey, brazil, and a bunch of other countries.

We export scrap because we junk more stuff then we build here in the US. Before people made money scrapping most of that junk just went into a landfill.

The debt ceiling doesn't matter, its a made up line.

As far as cuts go, unless you have a surplus to pay back principle cutting spending doesn't mean anything. Over the last 30 years the tax on those making the most money has dropped like a rock, while the middle class has evaporated so we have less income from taxes then we should. The reason most political types don't care about the debt is because they know it is not getting paid back anyway. Our major problem is that our banking system is insolvent, meaning our money (once the general population figures out the banks are broke) is also worthless.

Originally Posted by unknownk

We export scrap because we junk more stuff then we build here in the US. Before people made money scrapping most of that junk just went into a landfill.

The debt ceiling doesn't matter, its a made up line.

As far as cuts go, unless you have a surplus to pay back principle cutting spending doesn't mean anything. Over the last 30 years the tax on those making the most money has dropped like a rock, while the middle class has evaporated so we have less income from taxes then we should. The reason most political types don't care about the debt is because they know it is not getting paid back anyway. Our major problem is that our banking system is insolvent, meaning our money (once the general population figures out the banks are broke) is also worthless.

We don't have a revenue problem we have a spending problem!!!! We can't stop thinking of new ways to spend any extra dollar we might make. Sorry I just got out of the bathroom.

PSP for president! PSP for president. It even rolls off the tongue nicely. We need a hard working, struggling, good ole American to run for President. We need change and I agree it needs to be done with someone who isn't a typical politician with their head stuck up their ass. I'd vote for you PSP.
Good thread, look what I started.

Olddude, eventually when history looks back on this period in hundreds of years from now it will be remembered as the corporate years. When large publicly traded companies ran america for the worst. It started in the 80's and when will it end who knows but america is forever changed by large companies that can contribute whatever dollar amount they see fit to any political figure good or bad and are not held responsible when they do something unethical. example (sub-prime mortgages) no one has gone to jail over it. There are other examples I just don't want to keep getting mad and thinking about how screwed up the USA is and how my kid has to live with all this debt which is going to come due. Corporations are sitting on over 2 trillion dollars in america right now and they refuse to spend it on innovation and creating jobs which is what companies used to do with there money. Now its all about increasing the share price and profit profit profit at all costs. That might mean shutting down a plant and moving it to a cheaper labor country or cutting 1000's of jobs it doesn't matter to them anymore. I think I am getting nauseated again. When was the last time that a company was broke up because it was to big and held to much power in a certain industry. The last one I can think of was ATT and BELL back in the early 90's.

Shred is also $160 here in Tulsa. 45 days ago it was $220.

PSP - I completely agree with everything that you said as far as being problems in our country. However, I do not see ballooning deficits as a catalyst for falling prices. If anything, the opposite Should be true. As the deficit grows, the dollar weakens making commodities more expensive as denominated in USD. The weird thing is that the dollar is actually appreciating. This is why scrap prices are down. A strong dollar means lower commodity prices. Take a look at the 6 month chart for the dollar. Notice the spike in May right before prices started falling.

All good stuff guys, but what I really want to know is..... Any ideas or opinions on when prices should start to rise?