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Post-Sandy US scrap metals tight, more plentiful later: trade

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Post-Sandy US scrap metals tight, more plentiful later: trade

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The US scrap metals industry is expecting tightening flows in theshort-term and increased flows in the long-term as power and normalcy areslowly being restored to northeastern US coastal areas decimated by HurricaneSandy, market sources said Tuesday.

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With difficulties obtaining fuel and power outages shutting shreddersand scrap yards, concerns about tight scrap supplies, which existed wellbefore 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 Coastscrap source said Tuesday. "It will take awhile to get in the pipeline. Inthe short-term, we have a shortage," he added.

With delays related to insurance claims, many scrap market participantscontacted did not expect to see material from the storm this month.

"Whatever cars were destroyed, they will come into the market over sucha 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 scrapyards, but it is premature to estimate Sandy's vehicle destruction tally.Scrapped vehicles contribute multiple metals and materials to the scrapstream, including steel, lead batteries, aluminum, copper, and resins.

A New York scrap yard source who avoided most of the damage associatedwith Sandy still reported a substantial dropoff in normal flows throughoutlast 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 smallthings, but there are a lot of insurance claim issues."

A New Jersey scrap yard that was down last Monday through Thursday citedlines of people at yards in residential areas, and much of the scrap beingcollected was aluminum, according to a worker there.

"We have no processing equipment, but we were able to run the office andscale on generators," an employee at the New Jersey yard said.

--Nicholas Tolomeo; nicholas_tolomeo@platts.com--Edited by Robert DiNardo, robert_dinardo@platts.com