Scrap sales soar as prices rise

2008-07-25 00:00

Scores of locals who have been able to get their hands on scrap steel have flocked to scrap metal dealers across Pietermaritzburg in the wake of rising steel prices and a certain amount of desperation from those who have felt the pinch of the tough economic climate.

Every month, thousands of people from the wider KZN Midlands, Richmond, Cato Ridge, Estcourt, Greytown and even Harrismith come to Pietermaritzburg to sell scrap steel.

Every day, a whopping 500 people flock to the three Pietermaritzburg-based scrap metal dealers who provided Weekend Witness with statistics.

Sellers bring along a wide variety of ëscrapsí, including unusual and even rare items such as ëcollectableí cars manufactured in the 1940s and 1950s, farming implements that are well over a century old, old coal stoves, kettles and sewing machines.

However, they predominantly sell automotive body scrap, wire and even underground pipes.

Richard Spearman, of Wayneís Scrap Metals told Weekend Witness that they averaged 360 people a day last month, up a hefty 44% on the average daily figure of 250 people in January 2008.

Timothy Lloys-Ellis, partner at Central Waste said although they do not deal primarily in scrap steel, they accommodate an average of 150 people a day, a 150% increase over last yearís daily average of 60.

Vee Gounden, owner of Midlands Metals said they buy and sell about 1000 tons of metal ñ mainly scrap steel ñ every month.

Lloys-Ellis said they buy and sell about 500 tons of metal a month.

Steel prices in South Africa have risen four times so far this year.

Globally, steel prices rose by more than 40% between April 2007 and April this year.

Spearman said they pay R700 per metric ton for sub-grade steel and R1700 per metric ton for ëheavyí steel.

The average ëwalk-iní seller can fetch between R60 and R200 per load, depending on the weight and quality of the scrap steel.

According to Gounden, a seller with one bakkie-load can fetch well over R1000.

Most of the steel is shipped to overseas markets, particularly thriving economies such as China, India and the United Arab Emirates.

The companies stressed that they do not buy stolen scrap metal and have taken measures to ensure that this remains the case.

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