How the Canadian Dollar Affects Scrap Metal Prices

Scrap metal prices in Canada are ultimately derived from global commodity markets priced in US dollars. This means the CAD/USD exchange rate has a direct and significant impact on what Canadian yards can pay.

The basic mechanism

Copper, aluminum, and other metals trade on the London Metal Exchange (LME) in US dollars per tonne. When a Canadian yard prices your copper, they're starting from the LME price, converting to CAD, then subtracting their costs and margin.

If the CAD is at 0.75 USD, one tonne of copper at USD 9,000/tonne translates to CAD 12,000/tonne. If the CAD falls to 0.70 USD, the same copper is worth CAD 12,857/tonne — but Canadian buyers importing to compete with US prices would adjust their buying downward to maintain margins.

When CAD weakens

A weaker Canadian dollar typically puts downward pressure on what yards pay in CAD terms, even if LME prices hold. Yards are buying in CAD and competing with exporters who price in USD.

When CAD strengthens

A stronger CAD can allow yards to be more generous in their CAD offers. During periods of CAD strength, scrap prices in Canada can track closer to their USD-equivalent values.

For sellers

You can't control exchange rates, but understanding the mechanism helps you make sense of price movements. When your local yard explains that prices are down because "the market is soft," the CAD/USD rate is often a significant component.