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How Payment Rates Are Determined for Scrap Metal

Whether you’re a frequent scrapper or someone new to the trade, chances are you’ve noticed scrap metal rates change frequently. Like the stock market, the value of metals tends to rise and fall – sometimes drastically. You may wonder about the going rate for scrap metal per pound, and why it fluctuates.

In general, the primary approach a scrap dealer will take when determining a fair rate is to offer customers the current market price for the metal. However, that is just one of several components that go into the equation. Sgt. Scrap is a premier scrap dealer serving New Jersey and a wide area in surrounding states. Here, we offer details about the dynamics that contribute to the price you might receive for your scrap.

The Quality of Your Scrap Metal

One of the main factors affecting the offering price for scrap metal is quality. Corroded scrap metal, or metal covered in insulation or other contaminations of side metal will likely receive a lower offering price. The same goes for scrap containing a mixture of metals, such as aluminum with steel bolts and brass with other metals.

Lower-quality scrap metal requires more effort on the dealer’s part to clean for proper processing and recycling, which costs them time, which explains the lower price for the seller. You may get a higher offering price for this scrap metal if you clean the metal thoroughly before bringing it to the scrap yard.

Amount of Scrap Metal

How much scrap metal you bring in for recycling may also impact the price you’re offered. In some cases, the larger the quantity of scrap metal, the higher the price. To get the best price, consider saving your scrap metal until you have an abundance to sell, instead of bringing it one pound at a time. This requires the scrap dealer to do fewer transactions and pay fewer transportation costs, making them more likely to pay you a higher price for a larger quantity of scrap metal.

The Time of Year and Your Location

An often overlooked factor affecting the current rate for scrap metal is the time of year. During the spring and summer months, when the weather is nicer, the demand for recycled metals is higher. This is in large part because the construction and automobile industries experience their busiest times during nicer weather months and require more materials. Production tends to slow down once the cold, snowy weather hits, meaning scrap metal rates may go down.

Where you live can also affect the offering price. In most cases, the scrap you sell is not fully processed at the scrap yard where you brought it. That means it must be transported somewhere for further processing. Scrap metal that requires transportation to another site likely will receive a lower price. Additionally, living in a city where the cost of doing business is higher can result in a reduced offering price.

Supply and Demand

As in virtually every industry, supply and demand are pivotal factors when it comes to scrap metal rates. When demand is high and supply is low, it will sell for a higher price at a scrap yard. Conversely, if supply is ubiquitous and demand is down, scrap metal will sell for a lower price.

A good idea is to stay on top of supply and demand trends within the scrap metal industry. This can make it easier to determine when you should sell and help you estimate at what times you can earn the most money for recycling. Sgt. Scrap lists today’s prices, so you can always check our website to find out what we’re paying for various metals.

Receive Competitive Scrap Metal Rates at Sgt. Scrap

People wishing to receive fair prices for their scrap metal should turn to the scrapping experts at Sgt. Scrap. We are dedicated to offering our clients the fairest and most competitive prices for the different metals we buy. To learn more about our current scrap metal rates or our other services for customers across New Jersey, Delaware, southeast Pennsylvania, and parts of New York, contact us today.

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