May 1, 2007

Omni Source Inc.

Tim Eiting, Rotary Club Charter Member and employee of Omni Source Inc. addressed the club about various issues influencing the scrap metals markets.  Omni is the largest scrap handling company in the US.  It is privately held and maintains about 50 facilities in this country.

Aluminum is a small portion of the company's business but Tim shared that aluminum can recycling is a major part of the recycling industry.  It is bringing about $.70 per pound with little change in 3 years.  The various grades of Aluminum plate for machining provide a major market for Omni and it is currently selling at about $1 per pound.

Changes in the copper market have seen an increase from $1/lb 15 years ago to about $3.50/lb currently.  Increased demand from China has been a major factor in the market pricing and there are daily shipments into that market.  The demand is so high in China that they have provided for manual recovery of copper from used electric motors where 300 to 400 women will work all day to extract copper from the motors.

Stainless steel also has seen major changes with 304 SS having an 8% nickel content.  Over the past 5 years, nickel costs have increased from $2/lb to >$20 currently.

As prices continue to rise, theft has been of increasing concern in many areas including construction and transportation of these commodities.  Metals have been known to be stolen from AC units, wire has been removed from building sites and aluminum bleachers have been stolen from stadiums.  Also, insurance costs for transportation of metals has been driven upwards and a truckload of Brass and Copper might be insured for around $40K.

Hosting Rotarian: Tim Eiting