BIR World Mirror on Non Ferrous Metals - October 2013

Don’t forget the time-lag

Modest worldwide economic growth is predicted by most forecasting entities, a view that most hold should lend support to metals prices for next year. While the developing markets are still seeing corrections in their recent GDP growth, their progress coupled with slow but hopefully sustainable economies in the industrialized regions supports the optimism expressed by most during LME Week in early October. While the growth rates we have seen thus far in 2013 have not found their way to improvement in our business, prolonged economic growth will certainly eventually lead to increased scrap availability and, hopefully, acceptable margins.

Scrap is finding its way into many more conversations in the overall discussions about metals values for next year, especially in those concerning copper and secondary aluminum scrap. Most end users have complained that scrap in both these sectors is too expensive a raw material in relation to the products for which it is used. It is hard to argue, but remember there is always a time-lag between increased industrial production levels and scrap availabilities that needs to be worked out before things become more balanced. With economic recovery comes more production, and hopefully a more steady availability of non-ferrous scrap to both the merchant and end-user communities.

It would be remiss of me not to take this opportunity to thank Dr Peter Dahmen who leaves the BIR Non-Ferrous Metals Division board after serving so diligently as our Senior Vice President. Peter has done an excellent job and was instrumental in overseeing the evolution of our recently-released statistics project. Thank you Peter for all your hard work for our Division.

Robert Stein
Alter Trading (USA)
President of the BIR Non-Ferrous Metals Division
15 October 2013

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