TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Scrap metal collectors lose business due to price drop
METAL TRASH AND TREASURE: Junk collectors carry metal scraps from an old building near Kali Jodo in West Jakarta in this file photo
Change Size
METAL TRASH AND TREASURE: Junk collectors carry metal scraps from an old building near Kali Jodo in West Jakarta in this file photo. (JP/P.J. Leo)
Dozens of pushcarts, which are usually shoved by mobile junk vendors around housing complexes, were parked idly in front of a junk distributor near a traffic light on Jl. Letkol Sugiyono, East Jakarta recently.
Nineteen-year-old Erik Estrada, son of the junk distributor, was sitting in his shop as idly as his father's pushcarts.
"Only three of our 27 vendors are currently out there working to buy scrap metal and other junk in nearby housing complexes," Erik said.
"The rest prefer to stay in their kampung or hometowns to harvest their rice fields instead of working here because the price of junk metal has plunged over the last two months."
He said the price of metal waste had plummeted from Rp 58,000 (US$5.5) to Rp 35,000 per kilogram for copper waste; Rp 5,000 to Rp 2,200 per kilogram for scrap metal; Rp 15,000 to Rp 10,000 per kilogram for aluminum waste; and Rp 38,000 to Rp 18,000 per kilogram for brass waste.
Another junk distributor on Jl. Poncol, East Jakarta, Haki, said he had experienced a similar condition.
"The prices of all kinds of junk, from paper to plastic, but especially scrap metal, has dropped to half their normal prices," said Haki, who opened his junk shop 10 years ago.
Haki, who used to distribute two to three tons of scrap metal to five smelting factories in Cakung, East Jakarta, every day, said they could now only deliver the goods once every two or three days. He estimated that he had suffered losses of more than Rp 50 million over the past month.
Scrap metal is smelted in factories and turned into iron bars, which are then used for construction. The bars are exported and traded domestically.
"Today's economic crisis is worse than ever before," said Oji, 49, who has pushed pushcarts as a mobile junk vendor since 1980.
Oji came back to Jakarta from his kampung in Karawang after the recent Lebaran holidays with Rp 300,000 cash in his pocket only to find that life was financially more difficult.
After running out of cash, Oji said he had to give his identity card to his boss at the lapak (junk distributor) as collateral to receive Rp 60,000 in order to get by for a few days.
He said due to the plummeting price of scrap metal, people originally intending to sell junk canceled their transactions, deciding to wait until the price went up again.
Oji said many lapak had temporarily halted their business operations.
"My boss, for example, can only buy scrap metal now, but he does not sell it to the factories because the price is too low. If he ever stops buying from me, I will have to go home to Karawang where there is no work."
Similar conditions face scrap metal traders in Bekasi.
Saleh Lubis, a trader for 20 years, said he had accumulated more than 50 tons of scrap metal at his shop, adding that he had stopped buying metal from mobile junk vendors.
The price of scrap metal is set by the smelting factories.
Furthermore, there is no specific government regulation on the price of scrap metal.
The Association of Scrap Metal Traders chairman, Rizal M., said thousands of traders and tens of thousands of mobile junk vendors around Greater Jakarta were at risk of losing their jobs.
"The factories and scrap metal traders must reach an agreement on price," he said.
Rizal said scrap metal traders in Greater Jakarta supply 30 percent of the material needed by metal factories like PT Jakarta Cakratunggal Steel Mills, PT Gunung Garuda, PT Wahana, and PT Master Steel, while the remaining 70 percent was imported metal materials.
"If we stop supplying to factories, we fear the factories will increase their metal import volumes.
"Factories can also give the excuse that the market is determining the price," said Rizal, whose association was currently planning to protest at the factories and House of Representatives.
"In the meantime, we hope the trade and industry ministries assist us in finding the fairest solution to the price plunge."
