If you find someone who has good news to offer, take your time and enjoy it. Unfortunately, there isn’t much of it around at the moment. And the coming months won’t be easy given high energy prices, high inflation, low availability of metals and rising interest rates.
From an economic point of view, Germany is faced with a very sharp decline in the number of private construction projects. While this means you can now get building materials and fitters more quickly, the serious point is that fewer orders mean fewer metals are in demand. Regarding cash flow, higher interest rates are causing problems for many companies; while money was previously available almost for free, interest rates have risen by more than three points over the past year. At the same time, credit insurance companies are reducing their limits for many smelters because the higher energy prices are having a huge negative impact on profitability.
Less demand for house construction, falling aluminium ingot prices and increasing discounts for copper are reinforcing the low availability of metals. If the first quarter of this year seemed tough, my advice is to stay buckled up. As always, the following general rules apply: do not take any risks, sell to business partners with liquidity and prepare yourself for the increasing bureaucratization of our recycling industry because Brussels is intent on tighter regulations for our sector governing foreign trade.
However, let’s finish on two pieces of good news: first, the greener industry transformation can only come about with our metals and so, in the long term, we are not only in the right industry but also on the right side of that industry; and secondly, BIR is celebrating its 75th anniversary in Amsterdam this May and I’m already looking forward to seeing many colleagues at the Convention.