Why Do We Care About the Metals Market?
The metals market in the United States affects the recycling industry and the price of metals in the rest of the world. Earlier in 2018, there was a lot of talk about President Trump’s metal tariffs and how they would affect the metal market as a whole. In order to better understand the metals market, it’s helpful to know the different kinds of metals and what happened when President Trump actually did impose the metals tariff.
Ferrous vs. Non-ferrous Metal
There are two main categories of metal–ferrous and non-ferrous. Ferrous metals have iron in them, which means they are magnetic and susceptible to rust. Most scrap metal, such as car parts, falls under the category of ferrous metals. Non-ferrous metals don’t contain iron and don’t rust. Examples of non-ferrous metals include aluminum, lead, zinc, copper, and stainless steel.
Just before the summer of 2018, President Trump placed a tax, or a tariff, on metals imported into the United States from other countries–specifically a 10% tax on aluminum and a 25% tax on steel. Such a tariff discourages the use of foreign metals and encourages local metal production. Many industries, such as construction, energy production (especially solar and wind), and car production, heavily rely on the use of metals; if imported metals become harder to come by, metal recycling becomes even more important in order to keep American metal production growing to sufficiently supply metals to all the industries that depend on them.
The Price of Metal
Unsurprisingly, metal prices in the United States have increased since the tariffs took effect. Industries using imported metal now need to compensate for the tariff. Considering the majority of metal in our country was imported, domestically-produced metal is now more in demand. The higher metal prices are good for the U.S. metal industry in the short term, but it remains to be seen how the metals market will be affected as time goes on.
In the rest of the world, the prices of non-ferrous metals are dropping and the market seems to be suffering somewhat, especially in the area of copper and nickel. Even in the normally steady ferrous metals market, stainless steel prices have lowered but they still remain relatively stable.
Recycling Remains Important
More than ever, recycling scrap metal is crucial to keeping the United States metal industry well-supplied and booming. It is now more costly to import metal, and that cost trickles down to the products and services consumers pay for. Recycling metal is also more environmentally friendly than mining it. At Klein’s Recycling, we will recycle your scrap metal to help keep costs stable and the environment clean!