Steel and Other Commodities Continue to Surge in Price
Regardless of what business you’re in, you don’t need a reminder about inflation. It is everywhere you look as your input costs continue to rise. The Fed and ECB both continue to maintain that this inflation is “transitory” in nature. We’ll take a look at the factors effecting this. As a business owner or manager it’s crucial to plan ahead. And as we’ve learned, you need to be ready for anything these days.
Factors that point to inflation persisting
There are so many variables to consider, it may be hard to determine exactly how everything will play out. At least it’s good to be aware of the landscape and what’s on it. Here are some of the major things that could mean inflation is here to stay.
• Cost of transport. Costs for container shipping have skyrockted this year, almost quadrupling in price. This affects everything that is shipped. The costs don’t appear to be going down anytime soon. From random port closures due to COVID to rising demand, the pressure is on for prices to rise. The Baltic Dry Index is at an eleven year high. Look at a chart, that will say it all.
• Supply chain issues. This is related to the above point. As ports, factories and such close due to either COVID related issues or hiring issues, supply chain delays will persist. This in turn will raise prices as producers and manufactuers adapt. The input cost for manufactuers in Germany has gone upabout 10%. That’s unheard of.
• Continued high demand. The demand for everything from microchips to tomatoes is surging, due to higher consumer demand after the lifting of restrictions and higher commercial demand as businesses spend stimulus money. This may level off, but for now, it seems strong. Amazon is now running 164 flights a day for deliveries just to keep up with demand.
• Inflation begets inflation. As prices rise and materials are harder to come by, many companies are stocking up on needed materials. This only makes the problem worse.
• Infastrucure bill. Its unclear if and when this will pass. If it does, we’re looking at billions of dollars being spent on raw materials.
For Steel in particular there are other factors at play:
• China has cut steel production in order to work toward their environmental goals.
• India is looking to ramp up production, so that could offset China somewhat.
• In its largest price hike in over a decade, Toyota Motor will raise the price of steel materials and goods that it sells to suppliers.
• Benchmark steel prices are up about 87% year to date, to almost $1,900 a ton. Steel prices averaged about $600 a ton in 2019, the year before the pandemic.
• Demand from Latin America surged the first half of this year.
• Demand is expected to abate in 2022. But anything can happen between then and now.
So how does it play out? In the past, inflation has caused the economy to overheat, which leads to a recession. So many of the inflation levels are the highest they’ve been in thirteen years. Thirteen years ago was 2008. We all remember how that played out. We’re looking at a possible recession in Q2 of 2022. It could be severe, since things are so extreme now. No need to fret about it, just prepare and adapt.
The one silver lining if there is a recession – it will cause inflation to abate. There will be less demand obviously. That being said, any business that works to be a in strong position will be able to take advantage of any opportunities that may arise. So don’t fret. Keep your eye on the indicators, have plenty of materials in stocks, and always monitor input costs.
Business/Automobiles/Toyota- set-to-steeply-increase-steel- prices-for-suppliers
thehindubusinessline.com/ markets/commodities/steel- prices-will-come-down-as- production-increases/ article36120649.ece
steel-news/latest-news/latin- american-steel-consumption- rises-in-january_may-1213616. htm
A group of Japanese Beverage Makers Comes Up With a Simple Solution to Deal With Marine Pollution
We’re all familiar with the growing problem of plastic bottles polluting our oceans. Only 9% of plastic is recycled world wide. 73% of beach litter is plastic. One million plastic bottle are bought every minute. So it begs the questions… where does all this plastic end up and how can we deal with as it continues to get out of hand?
Over the years the plastic bottle has eclipsed the glass bottle as a cheaper option. Glass bottles are sadly not practical for all applications. However a group of Japanese beverage makers are letting go of plastic bottles and are converting to aluminum cans for their teas and soft drinks.
The rate for recycling aluminum cans is 71%. This far exceeds the 24.3% for plastic bottles. Another bonus is that the beverages last far longer in the aluminum cans, meaning less waste and spoilage.
And the trend started by these Japanese companies is catching on. Unilever Plc, one of the worlds largest producers of consumer goods is even said they will start selling shampoo is aluminum bottles in the United States later this year.
Another benefit is that consumers will take notice. Plastic bottles are increasingly seen as a problem and turn off consumers. When they’re deciding what to buy, the aluminum can will stand out. While plastics are recyclable, consumers are often unsure of which or what plastics to recycle. Everyone knows that aluminum cans are recyclable and many food courts and halls have receptacles just for aluminum cans.
This is a good example of how some environmental solutions can be incredibly simple. Have you looked at your industry for a similar move?
Cardboard in Focus
From a mundane industry to a hot commodity
So many things have changed because of the pandemic and lockdowns. One of those things is the demand for cardboard. In 2020, the demand for cardboard boxes used to ship goods to consumers rocketed up almost 40%. No one saw this coming and businesses across the board are adapting. This transformation of the industry is more significant than anything seen in a generation. The lockdowns have locked in and sped up ecommerce, meaning the demand for cardboard boxes will remain very strong.
With that, prices for cardboard that is recycled into new cardboard boxes has gone up 60%, from a previous eight year low. If your business has a lot (or even a little) cardboard waste, now is the time to start a recycling program or enhance your current recycling platform. You can create an ongoing revenue stream from your baled cardboard boxes.
Starting a recycling program is incredibly easy and cost effect. You can purchase a new or rebuilt vertical baler from PTR to get things going. We have a vertical baler for every need. Check out our line up here. The money you’ll earn from selling your baled cardboard will eventually pay for the baler, especially now with prices so high, and looking to remain that way for the foreseeable future. Many cardboard box manufacturers are selling out immediately, while back orders pile up.
Another factor contributing to demand for cardboard boxes is the conversion from plastic packaging. Consumers are seeking out products with sustainable packaging. That means less plastic containers and more paper and cardboard based packaging. This is another strong trend that isn’t going away anytime soon.
That being said, not only would your recycling program create another revenue stream, you’d be doing your part to help the planet. This is something you can advertise to your customer base. Get the word out on your website, social media and with in store signage. This will position you in your customers mind as “doing the right thing” and gives them an additional reason to stay loyal.
Contact PTR Baler & Compactor to discuss setting up a cardboard box recycling program using our vertical balers or about enhancing your current one.
PTR Baler and Compactor is Hiring!
PTR Baler and Compactor is Hiring!
We’re looking for a customer service representative and a controls engineer
As we continue to grow here at PTR Baler & Compactor, we’re looking to add two key positions to our team. PTR is a family owned and operating company located in Philadelphia. We have been recognized by the City of Philadelphia as an Employer of Choice.
We consider our workforce our most valuable asset. We strive to provide top notch compensation and benefit programs to allow PTR employees to protect their personal and financial health, prepare for their futures, and create peace of mind. We proudly offer Medical, Dental, Vision and Life insurance in addition to other benefits
Customer Service Representative
The bedrock of our success is excellent customer service. This important role requires an individual that has strong negotiation skills and the ability to deal with and interact with people. Strong and clear communication skills are essential to this role. Superior time management skills are a must.
The position also involves scheduling equipment installations, communicating with installers to confirm excellent customer service, dealing with both internal and external clients. Experience dealing with a large volume of customers is key.
This position is so vital, because dealing with our customers and ensuring they are satisfied is one critical to our success.Representative
PTR is seeking a Controls Engineer who will report to the Chief Engineer. Key responsibilities include the design and development of equipment controls and control logic solutions, create technical solutions to maximize customer value and creating accurate BOMS for projects.
Five plus years of related experience are required. Education requirements include BSEE, BSME, Control, Software Engineering, Mechatronics or related degree. Excellent communication skills are key.
This is a great position for a seasoned engineer that wants to utilize their experience in a forward thinking environment, with a focus on innovation.
Going Paperless – Part of the Green Mission with our Top 10 Tips
At PTR Baler & Compactor we are always focused on our “Green Mission” – going green and meeting our sustainability goals. We work with clients everyday to help them build recycling programs, utlizing our balers. While we’re always making moves on a big level – the little things make a difference too. That being said, we are proud to announce that all PTR offices will be going completely paperless by 2022.
While this doesn’t work for all businesses, its certainly worth looking into for yours. Once you start, you may be surprised at just how much paper your office uses. Below are tips to get a program together.
1. Go Digital. From invoices and internal forms to employee handbooks. Not only do you save paper, it makes it easier to stay organized and track things.
2. Talk to your customers. Find out what ideas they may have. They have an outside perspective on your organization and may suggest something you haven’t thought out.
3. You can go mostly paperless. There are some instances where you will still need paper. Thats ok. Just be sure to set up recycling bins around the office for this paper.
4. Talk to your vendors and partners. Request that they send their invoices and such digitally. This may not fit with their protocals, but it can’t hurt to ask. And you may inspire them to go paperless as well.
5. Digital Marketing. When possible, switch to digital methods to get the word out. An email blast saves a whole lot of paper versus a direct mail campaign. Another bonus – its usually more cost effective to go digital.
6. Set up your payment processor to email the receipt instead of printing a paper receipt. Every little bit helps!
7. Get tablets for use when taking notes in meetings, instead of using a pad. Another bonus – you can email yourself the notes and they’ll also be more legible.
8. Use QR codes for both employee and customer use. These can be used in place of menus and signage for example.
9. Use an digital signature service for sending documents that need to be signed. This is totally secure and is legally binding. (Check the specific service you use for details)
10. Think twice. Before you print something out, stop and think if you really need to. If you must print, try to duplex it – you’ll use 50% less paper!
Every business is different, so different ideas may apply. Take a look to see what you and your team can do to reduce paper use. Another bonus – you’ll spend less money on paper
Now Seeking Transportation Partners!
Do you have a CDL license and flatbed truck 48′ or greater? If yes, let’s work together for a win-win! We’re currently seeking partnerships with reliable, professional drivers to help us transport our equipment throughout the United States.
Here are the important details:
TRUCK TYPE/WEIGHT: Job requires flatbed, step deck or conestoga trucks. Most loads don’t exceed 30,000 lbs.
DESTINATIONS: Throughout the U.S. (occasionally Canada).
FREQUENCY: Average 10 trucks per day.
REQUIREMENTS: Loads must be tarped. Drivers are required to pre-call 24 hours prior to arrival at delivery location.
A key part of successfully meeting the sky-rocketing demand for our products, is being able to quickly deliver the equipment when the customer needs it. We need you to help us make that happen. Let’s work together together to create a solution! You’ll provide reliable, professional transportation for us, and in turn you’ll receive consistent, steady work. PTR Baler and Compactor is a world leader in the waste equipment industry located in Philadelphia. We’re a 4th Generation, family-owned company. Our mission is to help companies achieve their green initiatives by reducing waste streams and increasing recycling efforts.
Don’t miss this unique opportunity to grow with us for years to come! Contact us today at email@example.com.
-Eric Riethmiller, Owner & Vice President, PTR Baler and Compactor Company
Recycling Baler ROI
A recycling baler has a variety of benefits. It helps to keep facilities clean and free of hazardous debris. It reduces your company’s waste contribution and frequency of landfill hauls. The latter has a two-fold benefit, as it helps your company reach sustainability goals while also benefiting from those cost savings. Many haulers charge upwards of $300 every time they bull a container.
There’s another major benefit to consider when investing in a PTR Recycling baler: new revenue generation for your organization.
Your recycling baler turns what was once considered waste into a valuable recycling commodity. How valuable? Well, currently more than ever before. The demand and price of recycling materials, especially corrugated materials, is experiencing record highs this year.
Why is the cost continually increasing? “The need for boxes has been going up by 2 to 4 percent every single year because people love having stuff delivered to their door, and COVID has accelerated that,” (Recycling Today). We discussed this and more reasons for the increased demand in last month’s blog, “Industry Update: Cardboard Price Reaches New Heights”. You can read that full blog post here.
How much revenue can you expect to make with your recycling baler?
The number varies by how often you bale, the size of your machine, and the size of the bales it produces. Back in January of this year, “Plastics Recycling Update” published an article outlining the current value of recycling bales. From that article, they provide data from the SMP Index. These prices represent “what is being paid for post-consumer recyclable materials in a sorted, baled format, picked up at most major recycling centers.”
Here is the pricing information they compiled:
• The national average price of PET beverage bottles and jars moved up 16% this month and is currently at 7.58 cents per pound, compared with 6.55 cents per pound this time last month.
• The national average price of polypropylene surged upward this month and is now at 11.69 cents per pound, compared to 7.00 cents last month and 5.81 cents one year ago.
• The national average price of color HDPE is also up again. It is now trading at 17.19 cents per pound, up from 17.06 cents last month. This compares to a low 3.58 cents six months ago, in July 2020.
• The national average price of Grade A film is up 15%, now at 10.84 cents, compared with 9.44 cents per pound last month and 8.44 cents per pound this time last year. Grade B film is now 3.63 cents per pound, while Grade C film remains a low 0.81 cents per pound.
How soon after making your investment will you start seeing a return? On average, customers start seeing a return within the first 2 years of operation.
Investing in a PTR Recycling Baler is a smart move for your organization. You’ll enjoy the benefits of cost savings, the implementation of sustainability policies, and the creation of a new revenue stream. Contact PTR today to find the right equipment for your company!
source for pricing: New year brings higher bale prices
PTR Solar Power: The Polaris Power System
Did you know PTR manufactures Solar Power equipment?As an industry leader, we’re continually striving to leverage advancements in technology. Our Solar Power option provides an environmentally-friendly alternative to powering equipment. By utilizing energy from the sun, you’ll see significant savings with installation and operating costs.Our model Polaris Power System solar power option enables your organization to take a critical step in becoming a universal green energy. If your company has “green” goals, this is a great way to get there! Solar Power helps protect our environment, as well as our economy as we move into a future.The Polaris Power System provides a complete integrated solution of powering your waste equipment. It can be a stand-alone power source that requires NO external power. Or, it can be used as a hybrid energy option. With the latter option, you would need the support of an alternate 120 VAC charging configuration.
PRIMARY COMPONENTSThe primary components of the solar power option include:• Two 42 volt PV Photovoltaic Solar Panels,Each rated at 350 Watt. This converts sunlight into DC for powering and charing the machine.• 6KW inverter with built in AC charger and built in Solar MPPT charger.• 48 VDC 120Ah Battery Pack. This stores energy potential for machine power.• Auxiliary Power to run the compactor. There are 2 option here. The first requires the operator to install a 120VAC 30Amp power line. The second line provides a 100ft plug in cord that can be powered by an 15amp convenience outlet for supplemental charging.
Solar options are based on power requirements and intended use with consideration to frequency of use, number of cycles and recovery time to charge. First, we’ll determine the total power requirements of the machine and then size the capacity of the solar option with regard to the number of cycles.The Polaris Power System includes an intuitive, easy to use touch screen to serve as the local HMI (Human Machine Interface). System health can be determined quickly and easily based on status conditions including Low Battery Level Alarm, Battery Voltage, Battery Temperature, and many more.The solar option is usually provided as a factory option and mounted directly to the compactor. Note that if the solar option is provided as a hybrid option, you may need provision of a 120 VAC receptacle at 30 amps.It’s important to consider that even partial shading of the PV panels can significantly hinder the system’s performance. Ensure that the panels will be completely exposed to sunlight to get optimal performance!
Pictured are the PTR Solar Power Self-Contained Compactor and Solar Power Vertical Compactor. There’s lots of in depth information available, so contact us to learn more or request to be sent a complete manual.(800) 523-3654
Industry Update: Cardboard Price Reaches New Heights
Back in February, cardboard prices hit an all-time high. According to the Producer Price Index from the U.S. Bureau of Labor Statistics, it’s value has risen 4% since December 2020.
What’s behind the growth?
It wouldn’t come as a surprise to anyone to hear that e-commerce has grown rapidly over the last year. Online sales accounted for an incredible 14% of total retail sales in Q4 of 2020. In fact, it’s already surpassed levels it wasn’t expected to reach until the year 2025. This year, experts predict e-commence will bring in about $843 billion in sales. (ROI Revolution)
With people ordering products online at a higher rate and frequency than ever before, there has been a huge surge in the demand for corrugated and solid fiber boxes. But that’s not the only factor driving up pricing.
Beyond the rise of e-commerce, another significant factor driving up cardboard box demand is the housing market boom. Inventory is at record-lows, along with interest rates, while demand has skyrocketed. When people purchase homes, they need cardboard boxes, and thus, demand rises. Back in January, Packaging Corporation of America Executive Vice President Corrugated Products Tom Hassfurther said the following:
“We’re also seeing obviously the big trends in people moving away from cities, buying homes, when you buy homes, there’s a lot of things that go into those homes that are associated with corrugated boxes.”
Hassfurther also cited the move in consumer purchasing trends away from plastic and towards paper products. With all of these components are in “growth mode”, he believes demand is sustainability and will continue in an upward direction.
In addition, the following factors are increasing the demand for cardboard
• Most consumer segments growing in the fourth quarter of 2020
• Demand from restaurants for take out packaging
• Increased demand from China as their economy rebounds
There’s never been a better return on your baled cardboard than right now. Packaging giant Sonoco’s VP and CFO, Julie Albrecht, explained that OCC (old corrugated containers) prices “averaged $71 per ton throughout 2020, and that the company anticipates OCC will increase to average about $90 per ton this year.” This has been a drastic change since 2019, when the average pricing was at record lows. Now, it’s jumped around 196% nationally.
Further points as to why the price of cardboard will continue to rise
• Continued increased demand both nationally and globaly
• Growing inflation
• Growing transport costs
Be sure to this extra revenue stream for your organization running optimally by having regular service and maintenance appointment. Or take the time to start a recycling program if you don’t have one in place. You’ll be both helping the environment and increase cash flow. Contact PTR to learn more.
A Look at the Steel Industry During The Pandemic
The Fabricator is a magazine that provides market, industry, and product news to metal fabrication professions. Back in April 2020, they published an article called, “A brief history lesson on steel prices during crises”. It was the very early stages of the Covid 19 Pandemic, and the publication drew comparisons to the Great Recession of 08-09 in order to gauge how the steel industry would be affected by the global health crisis.
Reading this article nearly a year later, we know the steel industry, and all those industries that rely on it, are continuing to face significant challenges.
In Spring 2020, steel production and prices were indeed declining, but not nearly as severely as the Recession of ’08. Both hit suddenly and we saw a sharp decline in the demand and cost for steel. In 2020, mills were forced to close or drastically reduce their capacity, along with businesses across the globe.
Fast forward to mid-March 2021. While things are improving concerning the pandemic, many unknowns remain. Steel prices are now setting record highs. Demand is still grossly higher than what supply can keep up with. In an article published just a few days ago, “Steel prices continue to set new record highs week after week’, The Fabricator provides an updated look at how this is presenting very real challenges to fabricators and buyers alike. Availability is restricted, and pricing has become almost unpredictable. Throw the growing inflation into the mix and the landscape looks even more unpredictable.
According to SMU (Steel Market Update), “the market on March 8-9 showed the benchmark price for hot-rolled steel reaching $1,270/ton ($63.50/cwt), topping the previous high mark set in 2008 by $200/ton.” (TheFabricator.com)
Things to consider as one navigates this:
1. How and when to pass the price increase along to the consumer. Now is the time to plan on how to roll this out.
2. Keep your eye on inflation indicators, in particular, wage increases. While some industries like construction and hospitality are seeing increases, this isn’t affecting all industries. Wage inflation is a key driver of inflation.
3. Consider stockpiling inventory. Not just with steel, but with any consumable or commodity that is used frequently. This locks on your costs for a period of time. If this isn’t possible, try to negotiate with your suppliers.
4. Build partnerships. Unprecedented times call for thinking outside of the norm. Analyze what type of unconventional business partnerships could help ease the burden of rising steel prices and production costs.
5. Don’t rely on one vendor. Another reason for the rising price of steel is supply chain issues. If possible, have several vendors you can rely on for steel and other commodities, in the event that one can’t deliver.
We post two blog updates here a month, but be sure to connect with us on LinkedIn, for more frequent industry news!