Crazy times call for crazy amounts of hoarding sometimes. We’ve seen over the years when scrap prices dip down that many people hold onto their property and their brass and their other high valued items to be able to wait for higher valued times. One of the problems that we’ve seen during the coronavirus outbreak is that many people have lost their jobs, become furloughed or lost over time and additional revenue income.
One Way COVID-19 Affected Scrap Prices Even More
One of the biggest problems that we have seen recently has become one of the things that we never thought of in the past, scrap yards being closed.
We know that our sister company Rockaway Recycling closed the doors to peddler trade, as the outbreak was trying to become contained but at some point businesses have to reopen if they want to survive. Trying to figure out not only when your scrap yard is going to be reopening but also when it is a good time to sell your material is a problem that people are trying to figure out right now.
One potential problem that we might see from this is that scrapyards might have lower numbers than usual due to a lack of material and not making any money for a long period of time. While some might think that this is unfair many scrap companies have been paying their employee’s salaries and benefits throughout the entire COVID-19 outbreak.
And at the end of the day, private companies are allowed to do what’s best for them and sometimes customers could get damaged during the process. One of the things that you want to think about is your long-standing relationships with your scrap yards and asking them for any signs of transparency that they may have on any type of price increases in overall market.
Is It Time To Hoard Your Scrap Metal?
When scrap prices drop lower with economic downturns as it did with the COVID-19 outbreak, 2008 recession, and other tragic times, it’s important to know what you should look for when you are thinking about hoarding your scrap metal. Understand, how the scrap prices are affected by the different political and economic events are important. Here at the iScrap App, we have our Weekly Scrap Price Reports to do exactly that and keep you in the “know” about where scrap prices are going and where you can expect them in the near future.
3 Signs To Look For When To Start Hoarding Your Scrap
- How Are Oil Prices? – One of the biggest problems that we are going to see is going to be how low the oil prices became versus what the normal commodity prices are. With fights going on between Saudi Arabia and Russia on oil pricing along with the COVID-19 outbreak we have seen oil prices crashing over the last few weeks to lows that we haven’t seen in over a decade. These low oil prices might be great for the gas pumped, they will not be good for other commodity prices like iron or copper as these metals have gotten pounded. While everyone likes having low gas prices, not everyone likes having low metals prices if you are on the recycling side of things and unfortunately, this is gonna be something that hits us for a long time.
- Economic Downturns – When you see big things like COVID-19 take the economy to a screeching halt, this is a sign that commodities will get hit. Even if there is a demand for material at that time, when large, global events start affecting the stock market, naturally the commodities will get hit too. One of the first commodities affected will be copper and then usually followed by steel.
- Winter Weather – Believe it or not, if you live in an area that gets hit hard with snow and cold temperatures regularly, it may be a good idea for you to hoard your scrap during these months. Due to the difficulty of transportation, naturally, your local yards may lower prices and hold out. This would be a great time to learn to strip some of your wire at home and make a profit on it when the temperatures warm up.
What To Do?
If you are thinking about hoarding your materials, now is the time to and wait this out. But remember to have a secure way of storing your scrap. The next question will be what to do when the market starts to return to normal and people start going back to work. After the scrap yards get back up and running, we are hoping to see a better and more clear picture over the next few weeks to give us the ability to learn more about the prices.