Metal Monday June 28, 2021 with Nick Snyder and Brett Ekart.
Play the youtube video and follow along with the text below.
Nick Snyder:
All right. Last Metal Monday of the second quarter, actually.
Brett Ekart:
We're almost halfway.
Nick Snyder:
We're already halfway through the year.
Brett Ekart:
Yes sir.
Nick Snyder:
Which is crazy, man. It feels like this year just started at me for some reason. It's hot, hot here in Idaho. It's going to slow our flow down. But a nice thing about the markets is we saw a little bit of recovery on copper. We saw it bounce back.
Brett Ekart:
I think it's going to come back. I still think we see five bucks this year.
Nick Snyder:
Do you think that because of the demand, just basically the demand?
Brett Ekart:
Demand. The demand for it. They haven't stopped printing money. You're still going to get inflationary pressure. They're going to talk it off. The Chinese are going to try and talk it down as much as they can, but I think that demand is there. Think about even steel for example. It's hot here. It's hot in the Northwest in general. It's hot about everywhere. As long as the steel mills have the orders and their order books are full through August at least, the scrap flow has to come from somewhere. It's flowing better than maybe it has years ago, but not that much better. And the demand is significantly higher for new steel. So the prices are going to come up. It's a matter of time. I'm not predicting how much or when, but I predict strong ferrous market for the next few months.
Nick Snyder:
Gotcha. And maybe all the way into 2022.
Brett Ekart:
I think so.
Nick Snyder:
That's I think I've read and all the people I've talked to.
Brett Ekart:
The flow isn't that good.I've talked to a lot of scrap people, believe it or not.
Nick Snyder:
I believe it.
Brett Ekart:
The flow ain't that good. And the only people that have good flow are people that sat on iron the last few months. Even in our yards. We have iron because we held iron at the beginning of the year, because we felt that the price was going to come up. So it's not that our flow is just off the chain right now on the ferrous side, it's that we held scrap for a long time.
Nick Snyder:
We just sold a few loads here and there, but we held ...
Brett Ekart:
We held a lot of scrap, because -
Nick Snyder:
... 80% of our flow.
Brett Ekart:
Yeah, Because we felt that the pricing was going to be better. So once we cleaned that up, then we're back sitting in the same position as a lot of other people just waiting on flow. I'm going to sell into this market if the price is fair and the price is reasonable because I like where it sits today. But I still am pretty convinced that it's going to be stronger going forward.
Nick Snyder:
So you anticipated a ferrous market, then, obviously.
Brett Ekart:
I anticipate super strong sideways-
Nick Snyder:
And you're not sure.
Brett Ekart:
... to up. And realistically, it probably should be up considering what the steel mills are charging for new iron.
Nick Snyder:
Well, we see that articles all over the place, if you're paying attention to the AMM or any other metal website.
Brett Ekart:
Correct.
Nick Snyder:
This record setting numbers, record-setting numbers, record setting numbers. Then the beginning of the month it's, "Oh, the market's not as strong as we thought it would be." It makes no sense. Maybe I'm just not smart enough to figure it out, but it makes no sense.
Brett Ekart:
No, here's the deal. We don't sell the plate mills. We sell primarily the export market and to primarily rebar mills. One of our customers, they do a lot of plate cutting. Quarter inch to half inch plate, some smaller stuff. They probably have five waterjet [inaudible 00:03:55] tables. They go through a fair amount of skeletons. New Core talked to them here the other day and said that their price is going up $200 a ton for plate.
Nick Snyder:
That's crazy. Yeah.
Brett Ekart:
So, you tell me. I've never seen it $200 a ton ferrous scrap pricing increase.
Nick Snyder:
No, I know.
Brett Ekart:
Now we don't sell to those mills. So it's hard for me to extrapolate that and say, "Well, the rebar market should be X," but I do feel like at some point that trickle down is coming.
Nick Snyder:
We'll have to wait and see. I anticipate some up markets across the board. It just seems like when one commodity gets real hot, the others tend to follow. And that works both ways. One fall. That's where you get a little scared when you see copper fall 40 cents in a week.
Brett Ekart:
Makes your butt a little tight.
Nick Snyder:
Yeah, how much. Oh, all those good buys we made a week ago just went to shit.
Brett Ekart:
If anybody wants to feel any better, I have four loads of chops that are un-hedged. So four times, just shy of 70,000 pounds, like 200.
Nick Snyder:
And you got some PGMs out there, Brett. Let's not lie.
Brett Ekart:
Yeah. I know. I know. So anyways, anybody out there that's un-hedged I feel your pain sometimes.
Nick Snyder:
To be in this business, you got to get comfortable with being uncomfortable because you got to make the calls, you got to keep buying. You can't be scared to buy or why are we here?
Brett Ekart:
I agree.
Nick Snyder:
Hey, real quick. Brad from Detroit Scrap and Scrap University sent you something, Brett.
Brett Ekart:
Oh. Gifts?
Nick Snyder:
I told him I'd give it to you on the show.
Brett Ekart:
Dude. It's hard to beat a box that has a firework on it. Oh, shit.
Nick Snyder:
I cheated and looked at them already.
Brett Ekart:
Did you get jealous?
Nick Snyder:
A little bit. Yeah. A little bit. They're perfect for obviously the 4th of July.
Brett Ekart:
Dude. Either Brad's telling me I'm fat, I need to go for a jog, or that he found me some bad-ass Captain America shoes.
Nick Snyder:
Exactly. I think it has something to do with all the posts about our new Captain America truck, which is shout out to our hauling department.
Brett Ekart:
Dude, those guys killed it on that truck, man. I get the question all the time, "Are you guys going to work that truck?" And I said, "Every truck we have works." We put a lot of pride into our equipment and our stuff. But we work every piece of equipment, every truck we have. So Brad man, these are awesome, dude. I'm stoked. I know what I'm going to be wearing. As long as my feet don't sweat to death over the 4th of July, but I know what I'm going to be wearing here the next little bit of time. Those are bad-ass. Thank you, sir.
Nick Snyder:
All right. Our yards are going to be closed on Monday. So we'll figure out how to squeeze in a Metal Monday next week. So we'll see you guys in a week.
Brett Ekart:
We might have to do a Monday Zoom or something.
Nick Snyder:
Yeah. We'll do something.
Brett Ekart:
All right.
Nick Snyder:
Thanks everybody.
Brett Ekart:
Appreciate it guys. Thank you, Brad. Appreciate you, man.