Industry Analysis & Industry Trends
The Scrap Metal Recycling industry has faced a tumultuous past five years. Industry revenue has taken a beating, contracting at an annualised 6.8% in the five years through 2014-15. Upstream activities in the industry have been adversely affected by poor demand conditions. While consumers are keeping their purse strings tight and staying away from unnecessary purchases, manufacturing output has declined. This has lowered the supply of scrap metal generated from manufacturing activities. Lower consumption levels have also contributed to reduced waste volumes, leading to low growth in scrap metal supplies.
Low steel and scrap metal prices have contributed to large price declines and industry revenue falls in the past five years... purchase to read more
Industry Report - Industry Investment Chapter
The industry has a high capital intensity level due to high capital expenses and relatively low labour costs. To calculate the industry's capital intensity level, IBISWorld uses data from the industry cost structure. Depreciation is used as a proxy for capital, while wages are used as a proxy for labour. In 2014-15, depreciation is estimated to account for 3.6% of industry revenue, with wages estimated to make up for 10.0%. These show that for each $1.00 invested in capital plant, equipment and vehicles, approximately $2.78 is required to be spent on labour inputs.
The industry uses large and expensive equipment and machinery in its operations. Capital equipment in the industry includes furnaces, shredders, scrap metal balers, shears and magnet generators... purchase to read more