Ferrous and Nonferrous, United Kingdom

It’s like looking into the mist. You don’t really know what going on. Some people are trying to push the prices down in Europe. We are seeing the Asian market come through quite strong. Turkey is going to be quiet, so there is a bit of pressure on the downward price, but I don’t think it’s going to be sustained too long. Spain is a factor, especially for Northern European tonnage. Everybody is there trying to push the prices down as well, and I don’t think some people will sell.

We are hearing the Asian market is still strong. It is a difficult market to judge. There is a little bit of uncertainty in the market.

The U.S. is generating a lot of zorba and twitch. The same thing is happening in Europe. We are aware of more tonnage being offered out of the U.S. than ever before. People are getting used to the zorba. There is quite a lot of interest in the zorba grade at the moment.

The foundries are seeing business, depending on where you are. There’s a lot of automotive cast around that doesn’t demand its former premium because it’s a low cast iron with low residuals. So, we don’t see that premium as much as we used to. In fact, some foundries, especially in Asia, don’t seem to understand the value of the low-residual cast iron and perhaps buy into ordinary high-residual cast iron. The market is changing. Cast iron arisings in Europe are not as strong as they used to be. They are much further down from where they were 20 years ago.  

Because production of the low-residual plate type material from factories is not as high as it used to be, foundries are looking for low residual model steel. It does demand an extremely good premium price.

Some people try to blame the weather for lack of generation, but I really don’t think it’s had that much of an effect. I think it is the balances of the prices. I think there is a bit of a shake in the market, but it is not a shudder. We will have a better picture in February than we had at the end of January.

The market is quite strong for secondary aluminium. We handle a lot of taint/tabor and tense, for example. The market is quite strong. We don’t see any real weakness in the markets. People say it has gone down a bit here and there. To see aluminium stable we wouldn’t have dreamed of it, but today the aluminium market stays relatively stable. No one is running to the door with aluminium prices.

We’re looking at India and the other Asian markets other than China at the moment. We haven’t had the inquiries from China we usually have. They will be quiet for the first few weeks of February. I am planning a trip over to China and I have been told not to go until the end of February or beginning of March because no one will be there.

Sometimes we can’t get some of the high-quality material that we sometimes need in the market, where the premiums are. But basically it seems to be a decent balance between supply and demand of aluminium, and we trade aluminium all over Europe.

In 2011, I think we are still going to see some adjustments that are not good. I don’t think Western Europe’s growth is going to be as strong as people think, so that is going to cause slight pressure on keeping prices a little bit lower, I would think. I don’t think there are going to be any massive hikes in the market to make everybody really happy. People are moving tonnage on a back-to-back basis most of the time.

I think copper prices will stay high. I think it is going to remain strong. It is one of the metals we need for the future. I don’t think it is going to go through the roof, though. We are having reports of thefts all over the place. In my region we have had 160 metal thefts in December alone.  

I think we have to be cautiously optimistic. Being overly optimistic is not the way to be today. We just really have to keep our eyes open and keep our ears to the ground more than we would have usually done. I think it is going to be an interesting year. It is going to be different than other years. I don’t think we are going to see the hikes we saw in 2008. There is going to be some steadiness. I don’t think we are going to see any high peaks or low troughs.

Peter Mathews of Black Country Metals Ltd. can be contacted at peter@bcmetals.com.