A scrap yard calculates its buying price by starting from what its own buyer pays, a refiner’s percentage of the exchange price or a mill’s published price, then subtracting processing, freight, an allowance for market risk and its margin. At the scale it applies deductions for tare, moisture and contamination, and it pays tiered prices that improve with volume.
Scrap Price Today editorial guide, checked against current exchange settlements, recycler grade specifications and mill buying programs. Figures are examples; today’s prices are on the live scrap price board.
Once the arithmetic is visible, most of what feels unfair at a yard turns out to be a thin margin being protected.
Start from the consumer price
A yard sells copper to a refiner or a large processor at a formula price: a percentage of the exchange settlement agreed by grade. It sells steel to a mill at the mill’s published buying price for each grade, delivered.
Those consumer prices are the ceiling. The yard buys below them by enough to cover costs and make a profit.
Subtract processing
Copper pipe is cut and baled, wire is stripped or granulated, steel is sheared to charge size or shredded, aluminum is sorted by alloy. Labour, machine time and energy sit in the spread between the consumer price and the board.
This is why a yard pays more for sorted, cut material: you have done part of the processing.
Subtract freight and risk
Scrap is heavy and low in value per truck, so distance to the buyer comes straight out of the seller’s price. A yard 20 miles from a mill pays a few dollars a ton to deliver; a yard 500 miles away pays many times that.
The yard also buys today and sells later. If the exchange drops in between, the loss is theirs, so cautious yards leave more room on volatile days. Large yards hedge on the exchange; small ones cannot.
Add the margin
What is left is the yard’s gross margin: a few cents a pound on non-ferrous, a few dollars a ton on ferrous, multiplied by volume. Competition decides how thin it gets, which is why a city with six yards pays more than a town with one.
The deductions at the scale
| Tare | Moisture and dirt | Contamination | Downgrade | |
|---|---|---|---|---|
| Measurement | Empty vehicle or container weight subtracted from gross | Percentage of weight taken off wet or oily loads | Percentage taken off, or refused, for foreign material | Whole load paid at a lower grade |
| Typical size | Exact if measured; costly if estimated | 2 to 10 percent on turnings, radiators, outdoor steel | 5 to 20 percent, or refusal | One or two price steps |
| How to avoid it | Ask for a measured tare | Drain, cover and dry material | Remove steel, plastic and other metals | Sort by grade before arriving |
| Where it should appear | On the ticket | On the ticket, per line | On the ticket, per line | As a separate grade line |
Tiers and minimums
Most yards pay better above a few hundred pounds and better again above a thousand, because their own economics improve with volume. Minimum quantities and handling charges cover the labour of weighing and paying very small lots.
A worked example
- The refiner pays 92 percent of exchange for number 1 copper, and exchange is 4.20 dollars a pound: the ceiling is 3.86.
- The yard allows 6 cents for baling and handling, 4 cents for freight, 8 cents for market risk and 12 cents of margin.
- The board shows 3.56, or 3.62 for loads over 500 pounds.
- A seller who checks the live board and sees an indicative 3.60 knows this yard is inside the normal range.
Why two yards differ on the same day
Different consumers, freight, risk appetite and competition. One yard sells copper to an exporter paying a container premium this month; another sells to a domestic refiner. One shreds cars and wants light iron; another has no shredder and pays little for it.
Calling two or three yards with the same description of the same load is the only way to see those differences; the best scrap price guide has the script, and the country pages describe the buyer landscape in each market.
Key numbers
- Refiners typically pay 85 to 98 percent of the LME or COMEX price for clean copper grades, depending on grade; the yard works down from there.
- Mills reset ferrous buying programs monthly in most markets, which is why steel prices step rather than drift (World Steel Association and published mill programs).
- Moisture and dirt deductions of 2 to 10 percent are common on turnings, radiators and outdoor steel (published yard terms).
- Grade specifications that define what a yard may deduct for are published by the Recycled Materials Association.
Questions people ask
Why did the yard take weight off my load?
Usually for moisture, dirt or oil, or for steel and plastic mixed into a non-ferrous grade. The deduction should be written on the ticket as a percentage on the affected line; if it is not, ask before the material goes into the pile.
Can I negotiate a scrap price?
On sorted loads, larger quantities and unusual grades, yes. Yards have room in the margin and the risk allowance, and a seller who quotes the benchmark and the grade gets a better answer than one who asks for more without a reason.
Why do prices drop faster than they rise?
A falling market is an immediate loss on the inventory a yard already holds, so boards move down quickly. A rising market is only a missed gain, so yards raise boards more slowly and catch up over a few weeks.
Common mistakes
- Accepting an estimated tare instead of a measured one.
- Bringing wet or oily material and paying a moisture deduction on the whole load.
- Assuming a deduction is automatic; ask for it on the ticket.
- Selling small lots weekly when a monthly lot would clear a tier.
- Comparing your quote with a yard in another region without allowing for freight.
Related guides
- How Scrap Metal Prices Are Determined: From LME and COMEX benchmarks to the number a yard writes on its board.
- How to Get the Best Scrap Price: Sorting, stripping, weighing and comparing quotes: the steps that raise a payout.
- Why Scrap Prices Change Every Day: Commodity markets, exchange rates, freight and mill demand all move the daily number.
Check today’s numbers before you sell: the scrap price board, the price charts, the scrap value calculator and local rates on our scrap prices by country pages.
Frequently asked questions
Why did the yard take weight off my load?
Usually for moisture, dirt or oil, or for steel and plastic mixed into a non-ferrous grade. The deduction should be written on the ticket as a percentage on the affected line; if it is not, ask before the material goes into the pile.
Can I negotiate a scrap price?
On sorted loads, larger quantities and unusual grades, yes. Yards have room in the margin and the risk allowance, and a seller who quotes the benchmark and the grade gets a better answer than one who asks for more without a reason.
Why do prices drop faster than they rise?
A falling market is an immediate loss on the inventory a yard already holds, so boards move down quickly. A rising market is only a missed gain, so yards raise boards more slowly and catch up over a few weeks.