It's done on speculation. Also, the buyer is likely a scrap yard owner or exporter and can pay higher than you or I and still show a profit. I ran into that the other day at an auction where were several lots of copper wire I planned on bidding. A local yard owner was there and stated that nobody but him would be getting any wire. He actually owned several yards and was multi-millionaire. For instance, one lot I figured I could bid $300, strip it and still have some profit. I bid it to $250 and he countered with $500. He's not stupid - I figure he knows something I don't.