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PrintLast summer, the world’s appetite for recycled metals knew no bounds. In the Tacoma Tideflats, where most recycled metal in the Pacific Northwest winds up, the four big metal recycling firms welcomed lines of trucks piled high with car bodies, bed frames, tire chains and barbecue grills.
Used metal prices were so high, thieves were stripping copper wire out of light poles and prowling Park & Ride lots for catalytic converters.
Then it ended.
Since September, prices for used metal have dropped so precipitously the industry has essentially ground to a halt.
The regular trans-Pacific shipments of scrap from Commencement Bay to China and Korea have stopped; the stream of automobile hulks heading for the Tideflats has slowed to a trickle.
“This was the quickest and most violent downturn in our history, and I’m fourth generation,” said Steve Glucoft, general manager of Tacoma’s Calbag Metals Co., the largest nonferrous metal processor in the Northwest. “Prices are 50-60 percent of what they were 200 days ago.
“For us right now, it’s about cash flow,” Glucoft said. “It’s about staying alive and keeping the doors open.”
Calbag, along with Simon & Sons, Tacoma Metals and Schnitzer Steel, have been efficient and profitable forces in the international flow of metals, thanks to their easy ocean access to Asia.
The big four buy used metal products, separate them by type and crunch them into cubes or shred them. For the most part, they’ve been returning the scrap to China, where it has been melted down and turned into new products, many of which are shipped back to the United States through the Port of Tacoma.
In September, the Asia metals market suddenly took a dive. “It hit the bottom, and everything came to a screeching halt,” Glucoft said.
The fall was more dramatic because it began at such dizzy heights. In July, Portland-based Schnitzer Steel, which is publicly traded, reported a record 37 percent jump in profit – about $972 million – for the previous quarter.
On Dec. 17, Schnitzer announced it expects a loss in the first quarter of 2009 and said it plans to write down of the value of its metals recycling and steel manufacturing inventories by an estimated $60 million.
Schnitzer stock plummeted from more than $118 a share in July to just over $16 in November. On Friday, it closed at $35.10.(Source: thenewstribune)
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