Ok, so I have a friend of mine who works in industry. He was recently put in charge of getting rid of all of his company's scrap steel. He is from a foreign country and has no real knowledge of the scrap metals industry. They are having a real problem getting their scrap steel picked up on time from the company that is currently hauling it away. He was telling me this is getting him in trouble at work. I asked him how much steel they get rid of a month and he told me roughly 1 million pounds a month! The company that is currently picking up the steel picks it up and hauls it roughly 250 miles away.

I instantly thought this could be a great opportunity to help him and make some cash as well. The scrap metal is steel drums. They compact it into bundles on-site and load that into containers. I have the money behind me to purchase the metal and to handle the shipping of it to a scrap yard. What I don't have is any real knowledge of the scrap metal industry and how it works in volumes like this. I have seen #1 HMS ( I believe this is the metal drums are made from ) going for 370-395 per GT. When I have called some of the local scrap yards, they are pricing it at roughly 200-210 per GT. What is not making sense to me is that he said the company currently picking it up pays 288 per GT.



So if they are paying 288 per GT and round trip hauling it 500 miles round trip, what I am missing here? He told me the current shipper is not locked into any form of a contract and that I could get one through him. Any help would be greatly appreciated. If any of you have any other questions to help me put this puzzle together please let me know. Many thanks in advance!