Scrap Car Recycling Materials
Cash 4 Cars Cleveland is a local provider who junks cars for cash in Cuyahoga, Lake and Geauga Counties. We buy scrap cars in Euclid, Garfield Heights and Eastlake. Are you trying to determine the value of a junk car? The auto scrap and auto junk related commodity markets have been on a sharp decline this year. Steel is among the biggest losers in price and it is high unlikely to improve anytime soon. This decline in market pricing for steel is the primary reason for the plummeting value of a junk car. Those who buy scrap cars (also referred to as those who junks cars for cash) are forced to offer very little for auto junk right now.
Top 5 Reasons for the fall of scrap steel prices:
- Steel is a material that can be limitlessly recycled and the recycling processes continue to evolve.
- It is produced by China, Japan, Russia and Germany, all of which can do so at a lower cost than the US due to less environmental & governmental restrictions and lower costs of labor.
- The global economy and growth of real estate, particularly in China, had fallen and decreased the demand.
- Although producers are lowering output, there is excessive supply available in most markets.
- India has recently become a leading producer, meaning they will have less reason to import the material.
In the October 28, 2015 edition of businessinsider.com and article with the title ‘A massive Chinese industry is flashing warning signs that the world cannot ignore’ written by Linette Lopez discussed the following: “China’s steel industry is in crisis; the result of a combination of factors, including a slowing Chinese economy, falling commodity prices, and an industry with debt. State-owned enterprise (SOE) Sinosteel defaulted on a debt-interest payment of $315M on bond notes maturing in 2017– a sign that the worst may be coming. China’s economy is in a difficult transition from one based on investment to one based on domestic consumption. “New” China includes businesses in the services sector, like technology, retail, and banking. “Old” China includes the country’s property and construction sectors, manufacturing, and exports. It’s important to note that China is carrying a ton of debt, thus less profitable as they spend making payments on that debt. The Chinese government faces the challenge of managing this transition without a string of credit events crippling the economy.
As Bloomberg reports, Zhu Jimin, the deputy head of the China Iron & Steel Association (CISA), said that collapsing demand is putting the entire industry at risk. According to Jimin, production cuts are slower than the contraction in demand, therefore oversupply is worsening. China’s steel demand evaporated at unprecedented speed as the nation’s economic growth slowed. Average steel prices hit an all-time low on July 9. Now winter is coming, meaning construction will slow & demand for steel will weaken more. And when that happens, China will have to make a choice. Prop up its steel industry or make the rare decision to let companies collapse under the weight of their debt.” The complete story is available at this link.
Well it seems that the steel industry is going to be in trouble for the foreseeable future. In a future article I hope to analyze the situation from the manufacturing company perspective. If steel is one of your primary raw materials in production, the massive drop in the cost likely boosts profit margins.
The Value of a Junk Car
If you are wondering who junks cars for cash in Pepper Pike, Maple Heights or University Heights, C4C is available to offer buy my junk car services. To receive cash for scrap cars and related auto junk in Warrensville Heights, Lakewood and Tremont, contact our scrap car buyer today. We are here 6 days a week to buy scrap cars and we provide you a quote with the value of a junk car right over the phone. Complimentary towing of your scrap or junk vehicle is included in the junk car quote that we provide, regardless of whether the car is located in Linndale Village, Newburgh Heights and Collinwood. If your damaged car needs an expensive fix and is sitting at a mechanic shop such as Firestone, Conrad’s, Midas or a transmission shop located in Beachwood, Bedford or Bentleyville Village—we will pick it up!