More people selling scrap metal to make ends meet

Sue Book
Sun Journal Staff

A dealer in scrap metal says more people are turning to recycling, some out of desperation.

Metal recycling has been encouraged in recent years as a "green" initiative.

Recycling saves energy - 95 percent for aluminum, 85 percent for copper, and 74 percent for iron scrap - over using virgin ore and saves landfill space and greenhouse emissions.

But it has been around much longer because it makes good business sense: Scrap metal makes money.

A plaque on the front lobby wall at Goldman Metals on Neuse Boulevard in New Bern honors it as one of the city's oldest continually operating businesses. It was started by present owner Dale Goldman's grandfather Max Goldman, and then owned by his father Raymond Goldman.

It has been operated as a family business for more than 100 years and in this tight economy finds itself in the business of helping families get by.

"I am more determined than ever to do everything within my power to help people through these difficult economic times," Goldman said.

General Manager Vernon Riggs said, "Every customer that comes in our gate leaves with money. For some it means putting food on the table."

Beginning in the fall and continuing through the holidays and in the New Year, Riggs said, the customers selling metal changed.

"What I have seen in recent months, the faces of people pulling up in Lexus, Mercedes, $200 cars to $200,000 cars, were people ill-prepared to face these times," Riggs said. "I've seen the sick look on the faces of people who have lost their jobs.

"They are almost embarrassed but they were laid off for no fault of their own," he said. "I had to cut some of the best workers I've ever had. I hired them back, but you have to keep the boat floating or everybody dies.

"The number of beverage cans has increased exponentially with people out of jobs and they tell me straight out, this $20, this $60 is helping."

Riggs said Goldman's was the highest-paying company in the area for scrap metals for the last half of 2008. "I challenge anybody to find a better price," he said.

In mid-December, the company bought aluminum cans for between 60 cents and 62 cents a pound, depending on volume. There are about 33 soda cans in a pound.

Prices vary, sometimes dramatically, but scrap aluminum ranges from about 15 cents to 65 cents a pound, depending on the grade; copper has been from about 43 cents to $1.11 a pound depending on market and grade; brass ranges from about 50 to 75 cents a pound.

The company also buys old cars and catalytic converters.

"It does benefit us, yes," Riggs said. "But we're not recession proof."

The scrap metal recycling business has found itself in tumultuous times with record highs and lows in 2008 according to Riggs and to the Institute of Scrap Recycling Industries chairman.

"We've just come out of the green boom," Riggs said. "Everybody was recycling and for about two years we struggled to keep pace."

He said the boom started about four years ago and ramped up for about 2 1/2 years, then in about a 45-day span in the fall, the three big automakers stopped buying scrap metal and the supply-demand cycle was altered.

Overseas exports already on their way ended up floating. About 300 ships sat off the coast of China, then the largest importer of scrap metal, as companies reneged on contracts.

Other large importers of U.S. scrap include Canada, South Korea, Mexico, Germany, Taiwan, Turkey, Spain, the U.K., and India, according to the Institute of Scrap Recycling Industries.

Problems like the metal-loaded ships and other buyers of secondary raw products who reneged on contracts, prompted actions attempting to correct it. The Bureau of International Recycling encouraged the European Union to discuss the failures to pay for shipments and efforts to get extraordinary discounts with the World Trade Organization.

Riggs said that "a lot of people are pulling together to create their own market to buy, sort, separate, loading trucks and trailers, weigh and ship."

In 2007, scrap was a $71 billion industry employing 50,000 people. It included more than 100 million tons of assorted scrap metal.

Two out of every three pounds of steel made in the United States is still made from recycled ferrous scrap metal and 60 percent of metal alloy fabrication uses non-ferrous scrap.

"There are still a lot of people who can make money with what they have lying around their yard, in the garage," Riggs said. "And it still makes good sense to recycle."

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