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United Kingdom

UK interest rates were increased to 5% in June in the bid to combat inflation, which is likely to dent business confidence and expansion for the foreseeable future until inflation shows signs of decreasing. This has resulted in a tightened supply of non-ferrous material. Fluctuations on the LME brought some material back into the market and merchants are now moving volumes a little more freely, either in response to a lack of finance or in acceptance of current market levels.

Demand for UK material is still reasonably strong from the Far East and Continental Europe. There are some concerns that the European interest could be short-lived given the summer holiday shutdowns. However, China and the Far East continue to be strong markets for UK material.

Weakness in the aluminium market and less demand for the metal have seen it settle at substantially lower prices. Lead scrap demand remains reasonably high, with discounts narrowing for the time of year. UK markets are consuming most of the scrap domestically.

With Continental Europe and the UK in the relatively quiet summer months, no significant movements in supply and demand can be envisaged until the beginning of September.