Selling Canadian Scrap to US Buyers

For a Canadian yard, the closest buyer is not the only one worth hearing from. Some businesses that might want your material are across the border. This guide covers how to sell scrap metal to US buyers from Canada, how to compare those offers fairly and what paperwork comes up at the border.

One thing up front: a US buyer will not always pay more. Sometimes they value a load differently. Sometimes the local buyer still comes out ahead. The point is to see both and decide with real numbers.

Why buyers value grades differently by region

Every buyer prices a load based on what they plan to do with it: what their mill, smelter or refiner wants, how full their yard is and how far the material has to travel. Those things change from one region to the next, and from one buyer to the next.

So a grade one buyer is lukewarm on can be one another buyer is short of. It works both ways, and you only find out by asking.

Jeffrey Zwirsky, who founded SMASH, put it this way in a Q&A with Recycling Product News:

"More qualified buyers means more offers and better price discovery. A Canadian yard should have the chance to see whether a U.S. buyer values a particular grade or load differently, then decide whether the offer works after freight and the other sale terms are considered."

The offer has to work after freight and terms, not before.

Compare offers on a landed basis

An offer from across the border and one from down the road are not the same, even when the top number matches. Put every offer on the same footing: what you actually keep once freight, currency, fees and payment timing are counted.

On currency, a USD offer cannot be compared to a CAD offer until you convert it at the rate on the day. The Bank of Canada posts daily exchange rates each business day. They are a good reference, but the Bank says they are indicative rates only. What counts is the rate your bank gives you when the money arrives, and the longer you wait to be paid, the more that rate can move.

Paperwork at the border

Here is the general picture on paperwork, from official sources.

On the Canadian side

The exporters' guide to reporting from the Canada Border Services Agency (CBSA) says that in most cases you need an export declaration to export commercial goods from Canada. One of the most common exceptions is goods exported for consumption in the United States. In CBSA's reference table, goods that are not restricted and are going to the US do not need an export declaration.

There are limits to that:

• Restricted goods, meaning goods controlled, regulated or prohibited under Canadian law, still need a permit, certificate or licence to go to the US.
• Goods passing through the US to another country are different. CBSA says goods entering the US in transit on a transportation and exportation (T and E) bond need an export declaration.
• When no declaration is required, CBSA says to tell the carrier and show no declaration required (NDR) with the right explanation or code on the transport documents, such as the bill of lading. The codes are on CBSA's page of goods that do not need an export declaration.
• You can have a customs service provider do the reporting, but CBSA says you stay responsible for giving true, accurate and complete information.
• CBSA says you must keep your export records in Canada for six years after the goods leave.

CBSA also tells exporters to make sure the goods are allowed into the destination country. That is where the US side comes in.

On the US side

When goods arrive in the US, the importer must declare how they will be entered with US Customs and Border Protection (CBP). CBP's page on the entry process says the entry summary is the documentation CBP needs to assess duties, collect statistics and check that other legal requirements are met.

CBP's tips for new importers and exporters say certain resident importers may file entries on their own behalf, but many first time importers consult a licensed customs broker. CBP licenses brokers, but they are not CBP employees. Even when a broker is used, CBP says the importer of record is ultimately responsible for the entry paperwork and all applicable duties, taxes and fees. CBP itself does not require an importer to hold a licence, but other agencies may require a permit or other certification depending on the goods.

So before you accept an offer, agree in writing who is the importer of record, who hires the broker and who pays which costs.

This is general information, not customs or legal advice. A customs broker can confirm what a specific load needs before it ships.

When the local buyer still wins

Plenty of loads are better off staying close to home, especially when:

• Freight to a US buyer eats up the gap between the offers.
• The local buyer pays faster, in CAD, with no exchange rate to think about.
• The paperwork and broker costs outweigh the gain on a small load.
• Rejected material would be harder to deal with across the border.
• The local buyer gives you steady pickups and fair grading week after week.

Getting a US offer and then selling locally is not wasted effort. You learned what that load was worth to someone else. Our guide on adding buyers without losing the ones you have covers how to use that without burning a bridge.

Comparing offers on SMASH

On SMASH, each sale can accept CAD, USD or both. You set the minimum, the sale window, pickup or delivery and payment terms. Vetted businesses in Canada and the US bid on those terms or send counter terms, and you pick one or none. The buyer pays you directly under the agreed terms. SMASH can help arrange freight if you need it, and freight booked through SMASH is quoted and billed separately, so you can count it in your landed math.

To get a load ready for a buyer you have never met, see how to prep a load buyers can bid on. Then see how SMASH works for auto recyclers.