Recyclable Material Wholesalers

Brief Excerpt from Industry Overview Chapter:

The industry includes companies engaged in wholesale distribution of automotive scrap, industrial scrap, and other recyclable materials, along with auto wreckers primarily engaged in dismantling motor vehicles for the purpose of wholesaling scrap. Major scrap metal wholesalers include US-based America Chung Nam and The David J Joseph Company; Sims Metal Management (headquartered in Australia); TSR Recycling and ELG Haniel (Germany); and European Metal Recycling (UK).

Worldwide, the recycling industry generates about $200 billion in revenue, according to the Bureau of International Recycling (BIR). Turkey is the largest scrap import market; the US is the largest scrap exporter. Demand for scrap is growing fastest in Asian markets, particularly in China and India.

Recyclable material wholesalers in the US include about 6,200 companies with combined annual revenue of about $82 billion. The industry is expected to grow at a slow pace over the next two years. Key growth challenges include reliance on the struggling construction industry; fluctuating scrap metal prices; and trade barriers that inflate the cost of US scrap metal.

COMPETITIVE LANDSCAPE

Demand from the steel, auto, and construction industries drives the scrap metal wholesaling industry. The profitability of individual companies depends on cultivating relationships with suppliers and buyers. Most companies are small and compete by specializing in one type of material in their local market. Large companies have economies of scale in purchasing equipment and transportation. The industry is fragmented: the top 50 companies account for about 45 percent...