Sales of scrap metal by large collecting and processing yards in Mexico decreased 30.8 percent, year-over-year, in July. This drop, in addition to being the 13th consecutive annual drop, is the second most drastic drop since January 2010, according to SteelOrbis analysis of data from the national statistics agency Inegi.
Furthermore, with the 13 consecutive months of decline in the wholesale sale of metal scrap, the sector is two months away from reaching the worst period of recession in the industry, which lasted for 15 months (from April 2019 to June 2020).
The sale of scrap is of vital importance for the Mexican and global steel market. According to the steel company Deacero, 97 percent of the steel it produces is from scrap.
In the January-July period, wholesale scrap sales in the Mexican steel market decreased 25.9 percent.
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 30.8 percent drop in sales corresponds to total activities. Of that total, metal scrap concentrated 68.4 percent of the total sales of said industry.