Since there is no published article on this subject matter that deals mainly on the Philippine market, I am now sharing all the information that I have for those who are contemplating to start a business, for those who wants to explore, for those who would like to see how the junk business in the Philippines go, and how lucrative/risky this business is.

Before i started in this business, i tried to explore this channel but i don’t know where to research.  Nowhere in the Internet do i see information on how to start, what are its scope, how are terms understood, etc..  All i get are positive innuendos that says this business is lucrative, no spoilage, and always in demand.  It may be capital intensive but wiTh fast return.  While stumbling on different buy and sell sites, i came across several terms that i don’t understand, and the research on the web is totally different from what is really happening at the junk shops.  If i am to relate with what i have read on the web, vis-a-vis the junk shop world, I’d totally get lost because they have a different language. 

UNDERSTANDING THE BASIC TERMS: LOCAL AND INTERNATIONAL

HMS1&2 is hard metal scrap or heavy melting scrap/steel, as described internationally.  Local junk shops call it either SOLID, or MIXED. Solid means 1/4th inch thick or more, that which include used rails, ship’s remnants, heavy equipments, and the like. (More details are listed below) While MIXED means 50% of the thin ones like galvanized iron, and 50% heavily rusted metal, wrought iron, etc.  Solid metal commands a higher buying price and obviously the mixed ones commands a standard rate.  Foundry is where the junk shops deliver their collected metal scrap, while some of them are lucky enough to serve international orders.

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In the international parlance, HMS 1 has a ratio of 80:20 which means 80% purely solid metal, and 20% thin sheets. While HMS 2 are really the rusty galvanized iron, tin scrap and all the rejected solid metal scrap.  International buyers seldom buy HMS2, so this types normally goes to the local foundry.  Merchants stuff their container with low grade metal sheets in between solid metal because it ensures compact packing.  One truckload must contain the maximum capacity, and solid metal weight occupies a small space within the container, while the galvanized form occupies space more. 

At the local foundry, acceptance of deliveries are limited to those without radiation, bomb components, sand and mud, and rust is at a minimum level.  Sizes must also conform to the size of their furnace, 1 meter by 1 meter is the safest cut per piece. 

Internationally accepted are the ones that comply wiTh ISRI codes.  There are a whole bunch of these codes, ranging from 201 to 206, which stipulates the sizes and types.