Sales of scrap metal by large collecting and processing yards decreased 24.2 percent, year-over-year, in September. It is the fifteenth consecutive annual decline and thus equals the worst period of contraction in the last 15 years, according to SteelOrbis analysis of data from the national statistics agency Inegi.
The contraction in metal scrap sales in the Mexican steel market began in July 2022, marking 15 consecutive months of contraction. This matches the period in recession that began in April 2019 and extended until June 2020, according to the short statistical history of Inegi that began in 2018.
The sale of metal scrap is of vital importance for the Mexican and global steel market. According to the steel company DeAcero, which calls itself the largest metal scrap processor in Mexico, 95 percent of the steel it produces is with that input.
In the January-September period, wholesale scrap sales in the Mexican steel market decreased 25.9 percent. It is the worst percentage contraction in 14 years, only surpassed by the 37.4 percent drop in the same period in 2009.
Inegi’s information corresponds to the trade with wholesale sales of waste materials, which includes the sale of metal scrap, glass, plastic, paper and cardboard, among other reusable waste. The 24.2 percent drop in sales corresponds to total activities. Of that total, metal scrap concentrated 68.4 percent of the total sales of said industry.