To the loyal customers of Kimmel Scrap.

As I am writing this newsletter, on Friday May 10th the negotiations between buyers and sellers of scrap steel have not been finalized. Steel mills believe that the raw material they consume in the manufacture of steel products is too high. Scrap metal dealers and processors of scrap believe the price is too low, based on processing and transportation costs. What this really means is that 1/3 of our buying and shipping month is over before we even get a chance to sign agreements, ship our material and ensure it arrives at the desired Steel Mill or Foundry, during the current month.

It is difficult to understand the mind set of the different players in these equations. We have a few parts that are the cast members every month. Your steel mill or foundry buyer doesn’t want to run out of raw material to melt, nor does he/she want to overpay the consensus market based on what his/her competitor are paying for similar scrap metal product. The dealer like our selves needs to review our costs of receiving, shipping, processing and in some cases holding costs for a commodity that might take 3-6 months waiting for a sale.

One of the nice things about our jobs in the recycling industry is the learning, experience and opportunity for growth. When working with my employees and showing why 4% or more of one or two elements can make a huge difference in buy and sell of this product. Showing how our analytical equipment can get information in seconds versus the old grinding a sample and view the sparks to identify its chemistry the way that our grandparents did as well. It is nice to show how important these skills are and will be all the days of your life.

Wishing you all an enjoyable and safe summer month.

Robert Kimmel