The US scrap metals industry is expecting tightening flows in the
short-term and increased flows in the long-term as power and normalcy are
slowly being restored to northeastern US coastal areas decimated by Hurricane
Sandy, market sources said Tuesday.
With difficulties obtaining fuel and power outages shutting shredders
and scrap yards, concerns about tight scrap supplies, which existed well
before the storm in New York/New Jersey area, have been exacerbated.
"At this point the storm won't generate a lot of scrap," one East Coast
scrap source said Tuesday. "It will take awhile to get in the pipeline. In
the short-term, we have a shortage," he added.
With delays related to insurance claims, many scrap market participants
contacted did not expect to see material from the storm this month.
"Whatever cars were destroyed, they will come into the market over such
a long period of time, it will just dribble in like it did with [Hurricane]
Katrina," the East Coast scrap source added.
Katrina reportedly sent more than a half-million vehicles to scrap
yards, but it is premature to estimate Sandy's vehicle destruction tally.
Scrapped vehicles contribute multiple metals and materials to the scrap
stream, including steel, lead batteries, aluminum, copper, and resins.
A New York scrap yard source who avoided most of the damage associated
with Sandy still reported a substantial dropoff in normal flows throughout
last week and into this week.
"Our customers dropped off; no one has gas," the New York source said.
"It will take awhile to start seeing this scrap. We are starting to see small
things, but there are a lot of insurance claim issues."
A New Jersey scrap yard that was down last Monday through Thursday cited
lines of people at yards in residential areas, and much of the scrap being
collected was aluminum, according to a worker there.
"We have no processing equipment, but we were able to run the office and
scale on generators," an employee at the New Jersey yard said.
--Nicholas Tolomeo; firstname.lastname@example.org
--Edited by Robert DiNardo, email@example.com