They used to be called “ship-breakers,” but that term is now outdated. United States ship recyclers today are consummately green and must comply with a slew of strict regulations, including those from the United States Environmental Protection Agency (EPA).
Despite regulations, the business of ship recycling is booming these days. “Listen, when you have steel prices in the $300 a ton range and a large supply of scrap, I would say it was good,” said Richard Jaross, CEO of ESCO Marine. ESCO operates a 100 acre full service marine yard and recycling operation in Brownsville, Texas. “Compared to the nightmare we came out of at the end of 2009, scrap is doing well. It’s flowing, people are buying goods, manufacturing seems to be up, the economic dots are connecting and I’m very optimistic.”
Besides recovering large quantities of ferrous and nonferrous metals, American ship recyclers also salvage and market a wide variety of used marine parts. These include engines, generators and other serviceable gear. For example, ESCO is recycling an ex-Navy repair ship and selling off large amounts of machine tools, pumps and exotic valve assemblies. ...read more
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Ferrous in a recovering economy
If nothing else, the recent recession has engendered a new spirit of humility and caution in the American business community. Economic recovery has been steady, yet painfully slow. Many scrap metal businesses have trimmed operations in order to achieve maximum productivity from labor and investment in capital equipment. Moreover, there appears to be a reluctance to expand workforces capriciously or make large investments for expansions.
Scrap ferrous metal, however, has bounced back better than other areas of the economy in both price and demand. But the state of the commodity is fragile and highly susceptible to levels of demand for new finished goods. In October 2009, for instance, mill-buying prices for No.1 heavy melting steel delivered were approximately $240 per gross ton. This September it was approximately $350 per ton, and dipped to the $320 range in October. Early indications place the November price at close to $340 per ton.
Bob Garino, director of commodities for the Institute of Scrap Recycling Industries (ISRI) gave his overview of scrap ferrous. “It is a slow, mild recovery we are in, but we are recovering. We are seeing a softening in steel prices. End-use demand for the third quarter of 2010 was disappointing. The fourth quarter looks a little shaky as well. We are seeing lower prices on finished steel. If you look at hot rolled coil, for example, you can see there is some softness in the demand. That has lowered the demand for ferrous scrap. We saw prices drop in October and I think the assumption is that we are going to see a firmer market in November, but the increase probably won’t be as great as the decrease was for October.” ...read more