Recycling scrap metal is a great way to make some quick cash. In fact there are a variety of things you can scrap including materials from your home and garage. That is why so many homeowners will scrap their old cars, television sets, faulty kitchen appliances and more. Of course, it is every scrapper's goal to make the most money as possible on their scrap metal. There are a variety of ways to do this, organizing your metal, only making trips when you have acquired a large amount of metal, and cleaning your metal (breaking it down into it's single components) are all ways to increase your take home earnings. But one large influence on the your earnings when it comes to scrap metal, is the current prices. Prices constantly change for scrap metal, which can make it difficult to know when to recycle your metal.
What Causes Price Changes
There are a variety of reasons that scrap metal prices change. The best way to know what your local yard's prices are is to contact them directly. The reasons scrap metal prices change ranges from global reasons and local reasons. Here are some of the top reasons your scrap yard will likely change their prices.
- Market Supply/Demand: Like any industry, scrap metal is susceptible to changes in the market. Depending on the demand for recycled metal, prices could rise and fall. For instance, when there is a demand from car manufacturers for more recycled aluminum, the price of aluminum could increase. It can be difficult to predict, but experienced scrap metal recyclers can notice when prices trend.
- Stockpile Changes: Across the world there are large stock piles of scrap metal. If stockpiles are not being used, this can drastically lower the price for new scrap. For instance, after the 2008 recession, many countries and provinces saw lower scrap metal prices because stockpiles were not being used.
- Transportation Costs: The scrap metal industry relies on the oil and gas industry. Recycled metal often has to be hauled long distances. Yards will factor in the cost of moving their scrap metal, so when gas prices increase, metal prices can decrease.
- Local Competition: Local competition is a large factor in scrap metal prices. Generally, more yards means more competition. If a yard exists and there are no other nearby yards, they are not compelled to keep prices competitive. When you recycle metal, you want to find a nearby yard, but you may not want to go to the nearest yard if that means uncompetitive pricing. You have to factor the cost of transporting your metal compared to changes in prices.
What To Do With Scrap Metal Price Changes
Because metal prices change frequently, it is important to choose an appropriate time to recycle your metal. Unfortunately, it can often be unpredictable when prices will rise and fall. In many cases, certain metals may increase in value while others remain stagnant or devalue. It may not be beneficial to only recycle some of your metal, as opposed to all of it, depending on your distance to the scrap yard. The best advice is to weight these factors together when deciding where and when to recycle scrap metal. If you need quick cash, you may decide to scrap regardless of market fluctuations.