Could the US Bipartisan Infrastructure Investment and Jobs Act boost scrap metal prices in 2022?
Late last year, the US Congress approved a Bipartisan $1.2 trillion infrastructure spending package as part of the Infrastructure Investment and Jobs Act.
The legislation is aimed at rebuilding America’s roads, bridges, and rails; investing in electric vehicle production and infrastructure; as well as expanding access to high-speed internet and clean drinking water.
US Global Investors chief executive Frank Holmes said: “I believe this could be the catalyst for significantly higher prices for metals and other raw materials.”
Clearly, the building of bridges and railroads will require a lot of steel, and this investment is expected to boost demand for both primary and scrap steel.
American Iron and Steel Institute chief executive Kevin Dempsey said: “We applaud the fact that the new law, and the executive order implementing it, have a strong focus on enhancing US competitiveness and using American-made products – including by using American-made steel, which is cleaner and more sustainable than steel made in the other leading steel-producing countries.”
Upgraded power infrastructure
Power outages, according to the Department of Energy, cost the US economy $70 billion annually.
Investment of $65 billion in upgrading transmission lines is likely to lead to more demand for aluminum and possibly copper.
Again, this demand should feed into higher scrap values.
Electric vehicle charging infrastructure
Over 500,000 new electric vehicle charging points are planned as part of this law to boost the amount of EVs on the roads and highways.
It is estimated that these charging stations will need 250% more copper than is currently being used for charging stations in the US.
Of course, the US is also a major manufacturer of electric cars with Tesla, Ford, GM, and others all manufacturing vehicles in their factories across the States.
Electric vehicles use a lot more metals than traditional internal combustion engines (ICE). In particular, around 183 pounds (83 kilos) of high-value copper is used in an electric vehicle. This compares to 20 to 50 pounds (9 to 22 kilos) in an ICE car.
According to The Copper Alliance, by 2027, copper demand for electric vehicles will rise to 3 million tonnes, from just 185,000 tonnes in 2017. That’s a lot more copper that is going to need to be found.
Typically, EVs also contain more aluminum that has a higher value than steel but is used because it is lightweight.
Scrap metal dealers are going to see a lot more demand for copper and aluminum as a result of this law, while also dealing with the 287 million ICE cars on American roads that will one day come to the end of their life.
The Bipartisan Infrastructure Law will invest $55 billion to expand access to clean drinking water across 10 million households and 400,000 schools. Much of this will be removing lead pipes, which will need to be recycled.
How can AMCS help?
With scrap metal demand set to soar as a result of these measures in the United States, AMCS is here to help you maximize your revenue and profit margin.
Our AMCS Platform for Metal Recycling helps with pricing and inventory management, so you know what you have and how much it is worth from incorporated daily prices. In a time of strong demand, knowing what is stored in your yard and its value can lead to making informed decisions on when to sell and when to store your scrap.
In addition, our grading technology helps you identify the high-value scrap metals such as copper and aluminum that will be in demand for power infrastructure and EVs.
We’ve worked with scrap metal recyclers for over 30 years, so we understand your business and how to help you maximize your profits, while also complying with regulation and law.
By making your business more efficient and less error-prone from manual processes, AMCS can ensure you are more agile to take advantage of the opportunities created by the Infrastructure Law.
AMCS also helps you automate and optimize your logistics, integrate your truck and platform scales, as well as manage your contracts. This means you can focus on extracting the most value from your scrap inventory.
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