Recyclable Material Wholesaling in the US Industry Market Research Report from IBISWorld has Been Updated

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Growing consumer demand for recycled material-based products and increasing demand for steel will thrust this industry into a growth phase. For these reasons, industry research firm IBISWorld has updated a report on the Recyclable Material Wholesaling industry in its growing industry report collection.

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Strong global growth will spur industrial production, bolstering demand for scrap metal

The Recyclable Material Wholesaling industry's performance is largely dictated by demand from the scrap metal market. According to IBISWorld industry analyst Deonta Smith, “Increasing global demand for steel supports this market, since scrap metal is used in the production of steel.” Before the recession, increased demand for scrap to feed the world's steel furnaces (including primary metal manufacturers) caused average annual steel and iron scrap metal prices to skyrocket, which translated to higher revenue for industry operators. Conditions changed considerably during the recession, however, with excess supply and falling demand dragging prices down and putting the pinch on wholesalers. Still, wholesalers managed to increase revenue over the five years to 2013, selling significant quantities of scrap metals to emerging economies. IBISWorld estimates that revenue will increase at an average of 0.9% annually in the five years to 2013 to reach $73.3 billion. As global economic activity continues to ramp up, revenue is expected to grow 7.7% in 2013.

Though the Recyclable Material Wholesaling industry is relatively fragmented, there are several vertically integrated steel manufacturers that have acquired wholesaling operations over the past five years to gain more control over the supply chain. The pace of industry acquisitions peaked during the period up to the recession. Surging steel prices prompted steel manufacturers to acquire recyclable-material wholesalers to widen their margins because high steel scrap prices are positively correlated to steel prices. “These acquisitions led to fewer industry firms, as large manufacturers sought to bring scrap-metal wholesaling in-house, increasing the industry’s market share concentration,” says Smith.

The next five years will likely bode well for the industry. Strong global growth will lead to industrial production expansion, which will bolster demand for scrap metal, in turn, as heavy manufacturers use recycled steel. Also, steel manufacturers' demand for scrap metal will increase as these players increasingly adopt electric arc furnaces (EAFs) to make steel, a process that uses scrap metal as an input (instead of using coal). Emerging economies will also continue demanding scrap metal to meet demand for steel in their growing markets, ultimately pushing up scrap metal prices. As a result of these positive trends, industry revenue is expected to grow strongly in the five years to 2018. For more information, visit IBISWorld’s Recyclable Material Wholesaling in the US industry report page.

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IBISWorld industry Report Key Topics

This industry wholesales automotive scrap, industrial scrap and other recyclable materials. The industry includes auto wreckers that dismantle motor vehicles for the purpose of wholesale scrap. It also includes establishments that break up, sort and wholesale all forms of scrap iron and steel using power processing equipment such as cranes, hydraulic shears, baling equipment and cable strippers.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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Gavin Smith
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