Metal Monday December 13, 2021 with Nick Snyder and Brett Ekart.
Play the youtube video and follow along with the text below.
Nick Snyder:
Okay, welcome everybody. Another Metal Monday. How you doing, Brett?
Brett Ekart:
I'm doing better today than I have been the last few days so, no complaints.
Nick Snyder:
Cool, cool. I'm trying to think, we didn't have any firm pricing last week if I remember correct, for [ferrous 00:00:25]?
Brett Ekart:
No. Just everything pretty much spit out sideways.
Nick Snyder:
Which we expected that, we were kind of prepared for that, hoping for some ups.
Brett Ekart:
Well, I was anticipating, I mean, all truth, all cards on the table, I was actually anticipating December to be stronger than November. I mean I-
Nick Snyder:
But up 20 to 40, you think?
Brett Ekart:
I felt it was going to be an up month. And I feel like, just maybe some of like geopolitical events or whatever, kind of, it was able to take some gas out of it. Some, the market kind of got crushed that day after Thanksgiving and then everything's just been kind of wobbly lately. So I think everybody's kind of had a good year. So it really was nobody trying to finish or put any more inventory on the ground unless they really had to type of deal. So I kind of feel like that's kind of why it just softened out. I guess I'm really curious how January's going to come out.
Nick Snyder:
Yeah. I read that the article, was on Today's Daily on the AMM, who was just talking about January, how people are split, you know?
Brett Ekart:
Yeah.
Nick Snyder:
Split on January. A lot of scrap guys. I don't know if it's hopeful thinking, but it makes sense to me, they're saying because we, no one got anything this month.
Brett Ekart:
Yeah.
Nick Snyder:
A lot of people think that 40's coming in January. Some of the talking points that were in that article were, companies in steel mills and stuff didn't want to come in with extra inventory into the new year. So that tells you, you got January right around the corner with still a lot of shortages, still people still, the one thing in the article said they anticipate they need two to three times as much steel as normal in 2022.
Brett Ekart:
Yeah.
Nick Snyder:
So that tells you like, I'm not like some economical genius, but I would tell you simple supply and demand, you would imagine the price would go up. Now there's been a lot of times this year where I think things are going to happen and they don't. So I don't know, man, I think, I mean sideways better than down, but it feels like January, February, like one of those months you're going to see them ups.
Brett Ekart:
Yeah. It feels like there's potential. I mean, I don't know what that answer is all the way, but it feels like there's potential for sure. It's, I feel like it's still pretty early to tell what January looks like, but I always, January seems like people are going to want to come out of the gate strong. As long as the demand's there on the new steel side, I feel like that the demand will be there for the scrap.
Brett Ekart:
Now what happens to the, what's really kind of, I think dragging the scrap price down as of late, or at least not giving it, the momentum it deserves is the export market is still pretty soft. China's going through their issues. You've got like the Turkish Lira is just getting creamed, which then makes US steel more expensive because now their currency is worth less money. So they're going to, they got to pay more to get less, type of deal. And they're a big consumer of US scraps, especially off the east coast. So you really have those kind of issues, kind of pulling against, what's probably a fairly strong domestic market, but they just don't really have to pay any more-
Nick Snyder:
Yep.
Brett Ekart:
Than they're paying today because where else are you going to go with the material? And that's kind of the main, I think that's the main issue, I guess, if you want facing fair scrap.
Nick Snyder:
Yeah. And if anyone follows us often, we talk about that often we need them both to be strong. They both have to be at least fairly strong for them to kind of compete against each other. So, and I can't blame the steel mills. Hate it, but like if they don't have to compete with anyone on it, why bump your price?
Brett Ekart:
Yeah.
Nick Snyder:
I get it, you know.
Brett Ekart:
A hundred percent.
Nick Snyder:
But copper still hanging around that 4.30 mark. It was up early this morning, kind of came back off.
Brett Ekart:
It's like 4.28 this morning.
Nick Snyder:
Yeah, I mean, still good. Feels like that's kind of being held back too for multiple reasons, you know?
Brett Ekart:
Yeah.
Nick Snyder:
Platinum plating Rhodium, still getting beat up, you know? Pete Thomas, our friend at Zahner, he thinks that 8.50 platinum is coming within a month. So we'll see.
Brett Ekart:
He's so positive. What about Palladium?
Nick Snyder:
Yeah. Oh, I think he said like a 13 to 14 Palladium.
Brett Ekart:
Oh really?
Nick Snyder:
But who knows? But he thinks it's just going to be a rough first quarter and then he is going to take back off.
Brett Ekart:
Yeah.
Nick Snyder:
2022. Because he talks about, you can catch us on our Cat's Corner. We should be posting it hopefully today or tomorrow. But he talks about all these billions being invested in these minds.
Brett Ekart:
Yeah.
Nick Snyder:
For these PGMs. So people wouldn't probably invest those, that much money if they didn't have some confidence in the market too.
Brett Ekart:
Oh, a hundred percent.
Nick Snyder:
So he thinks long term we're still set up for some major ups.
Brett Ekart:
I think so too. I think that, those markets have room to run. You still, I think we're still very heavily automotive dependent. It may be the second half of 2022 before you ever see any real bounce.
Nick Snyder:
Yep.
Brett Ekart:
But you know, all it takes is a mine closure or some issue, some hiccup and all of a sudden, that squeeze is on.
Nick Snyder:
Yep.
Brett Ekart:
It's like anything, it's a very tradable market, bottom [planatium 00:06:13] very heavily traded with futures and whatnot. So that market gets push, push, push, and all of a sudden that's why you'll see a big down then it's a big squeeze up. It's a lot of speculation, but we'll see, time will tell.
Nick Snyder:
All right. Well, everyone have a great week and we'll be back next Monday.
Brett Ekart:
One more before Christmas.
Nick Snyder:
Yes, sir.
Brett Ekart:
All right. Take care.
Nick Snyder:
Thanks.