While it is not apparent from the cover of this issue, the February 2013 edition of Recycling Today marks our first redesign since 2008. While our cover remains the same, you’ll see as you read this issue that we’ve changed the look of everything between the front and back covers.
While much of the information Recycling Today provides has remained consistent with our redesign, you’ll notice some changes in pricing information that we first introduced in our January 2013 edition. In that issue, we began providing ferrous scrap pricing from American Metal Market (AMM). The reason for the change is that many of our readers are using AMM pricing as a benchmark for their transactions.
You’ll also notice that we expanded the number of charts we present in our Paper Commodity Report, adding a chart that presents OCC pricing over the last year in addition to monthly pricing information. This change is designed to allow our readers to identify pricing trends more easily.
As Recycling Today Media Group Publisher Jim Keefe writes in our January 2013 issue, From the Archives debuts in this issue. This department, which replaces One to Watch for 2013, is in honor of Recycling Today’s 50th anniversary, which we are celebrating this year. This department will feature historical information from throughout the last 50 years as well as a look at the scrap industry over the years through interviews with industry veterans and excerpts from various issues.
If you’d like to share your perspective on how the industry has evolved in the last 50 years in this special department, please email me or Editorial Director and Associate Publisher Brian Taylor at email@example.com or firstname.lastname@example.org, respectively. I also encourage you to send in photos of the oldest issue of Recycling Today you have in your archives. Your comments and images also may be used in a special commemorative issue of Recycling Today, which we will publish mid-year.
While the changes that I mentioned above are the most readily apparent, we hope you’ll find that the other tweaks made by our Art Director Karen Angus help to enhance your experience of Recycling Today. When it comes to redesigning our publications, the goal of the Recycling Today Media Group is to reflect modern design sensibilities in a way that best addresses the needs of the recycling market. The staff of Recycling Today hopes you feel as if we have accomplished this goal with the introduction of our new look.
Sludges, filter press cakes, filters and metallic dust are not materials considered the stuff of dreams for most recyclers, commodity traders or entrepreneurs. But these unglamorous materials are exactly what Alpha Omega Recycling Inc. (AORI), Longview, Texas, pursues as it builds a growing business.
According to AORI President Mark Wayne, the company handles a diverse array of materials and in 2012 expanded its services with the addition of a second facility in Jackson, Ohio, and a third one in Waverly, Ohio.
In 2012, the company handled some 3 million tons of what Mark describes as “industrial metal-laden waste material” as it worked to use, reuse and reclaim metallic resources and solve waste handling problems for its customers.
Hazard of the Job
The name Alpha Omega refers to the first and last letters of the Greek alphabet. AORI’s first responsibility is to properly handle materials that, in many cases, are classified as hazardous.
The list of materials that AORI accepts for processing is lengthy and not all of them are classified as hazardous waste. A healthy percentage of them are, however, including wastewater treatment sludges from electroplating operations, certain spent catalysts and sludges that contain arsenic, cadmium, lead, mercury, chromium or silver. The reclamation process can be significant in determining whether a waste is regulated as hazardous. Often times materials are only hazardous because they exhibit a characteristic and are not regulated when reclaimed.
These waste materials that require specific treatment will, in the final stages of the process, yield secondary commodities, some with considerable value.
But to reach those final (omega) stages, AORI must invest in capital equipment, chemical reagents, time and labor hours to ensure that its process manages the hazards in a safe and environmentally sound manner.
The company’s RCRA (Resource Conservation and Recovery Act) Part B permit describes the metals recycling process as consisting of: 1) leaching/extraction/metal recovery, 2) blending and drying and 3) batch processing.
The function of all processes at AORI is described by the company as recycling metal from industrial waste streams, stabilizing the remaining residue and returning metals back into the market as a usable product.
The proprietary metals recycling process AORI uses involves seven distinct processing routes for hazardous waste materials and six distinct routes for nonhazardous materials. All routes are based on the chemical extraction of waste for recovery of metals. Each of these processing lines has a variety of equipment that can include dedicated tanks, filter presses, redox (reduction-oxidation) units and drying units.
The nature of the materials handled by AORI means the company must hold identification numbers and relevant permits, including a RCRA Part B permit from the U.S. Environmental Protection Agency and must be prepared to communicate with regulatory agencies regularly. “The regulatory aspect of industrial waste recycling is the most challenging part of the industry, and standards apply to every aspect of waste recycling from containment structures to waste containers, storage to labeling and training to contingency plans,” Mark says.
The Finish Line
Providing a recycling solution for generators of hazardous or low-value waste materials is one revenue-generating aspect of AORI’s work. The other is producing secondary metallic commodities that can be sold into regional and global markets.
“Alpha Omega Recycling Inc. specializes in synergizing waste materials to extract metals of value and return those to market as a valuable product,” is how Mark describes the company’s mission.
AORI seeks any of several end markets for the wide range of secondary metallic products that emanate from its 13 production lines. “We sell directly to metal smelters, fertilizer manufacturers and refineries,” Mark says.
The range of different metals extracted from the sludges, filter cakes and dust that AORI processes can fill out a healthy percentage of the periodic table of elements, including aluminum, chromium, copper, nickel, iron, palladium, platinum, selenium, silver and zinc.
Some of these metals have active and well-established secondary markets, while others can involve finding a narrow range of select buyers.
Higher metal prices and consistent demand for scrap metals during the past 10 years have helped enhance AORI’s business equation, but Mark says there is still more work that can be done to maximize returns. “The global metals market is very challenging; there are many variables that affect market conditions,” he comments.
Achieving good returns for its customers on metallic yields is clearly important for AORI, as evidenced by its inclusion of metals exchange pricing information for copper, gold, nickel, platinum, palladium and silver on its website, http://alphaomegarecycling.com.
Up to the Task
AORI has established a track record of properly handling potentially hazardous wastes while extracting and recovering the maximum amount of metal.
The company’s leadership team is far from complacent, however, and its vision is far from “business as usual.”
The company describes itself as “an industry leader in developing new processes and technology to convert hazardous waste streams into productive raw materials,” and company leaders have high expectations for where those processes can take AORI. “Ultimately, our goal is to focus on research and development in order to assist our clients achieve zero-residue recycling for all of their hazardous waste,” the company states on its website.
Research is not a second-tier priority at AORI, says Mark, who notes that the company’s leaders have their roots in remediation and chemistry. “The current management of AORI includes waste management and remediation experts with experience in chemical engineering, environmental waste disposal and practical waste treatment.” The company’s facility in Longview includes a wastewater pretreatment facility as well as an on-site laboratory.
“Advancements in technology allow AORI to use cutting-edge technology to recover metal from many materials that formerly were not considered to be cost-effectively recycled,” Mark continues. “Industrial waste generators are able to utilize these industry advancements and recycle many of their waste streams that were once destined for the landfill.”
At its Texas and Ohio facilities, AORI can appeal to scrap and waste generators whose material streams go beyond those typically handled by recyclers—such as medical X-ray film and some types of batteries and electronic scrap—whose foremost concern is securing safe, environmentally sound on-shore processing of these materials.
When it comes to handling medical X-rays, AORI says, “our silver-recovery process complies with HIPAA (Health Insurance Portability and Accountability Act) handling requirements for medical X-ray film and helps hospitals across the country properly recycle expired film archives.”
In addition to responsibly handling these X-ray films on the front end, the company also touts its processing experiencing. AORI says on its website that its “experience in the silver-recovery process ensures that customers receive the best return rates.”
Mark says AORI’s leadership team is optimistic about the company’s ability to grow its business both by accepting additional materials and by extracting new types of metallic elements.
“Alpha Omega Recycling Inc. is exploring many new technologies to compete on in a global market,” he comments. “New business ventures include e-waste management facilities, rare earth product enhancement and expanding our low-grade-metal management capabilities”
Mark says the company sees a number of growth opportunities ahead. “Finding opportunities in which Alpha Omega Recycling Inc. can accept a waste stream for use in extracting metals from another metal-laden waste stream is one of the goals here,” he states.
Mark says AORI sees several such opportunities on the horizon and perhaps some over the horizon in the form of bringing its services to a more geographically dispersed customer base.
He adds, “We strive to find synergy in waste recycling. Alpha Omega Recycling Inc. wants to continue to provide excellent recycling services for our customers and has plans to attract new customers both domestically and internationally.”
The author is editorial director and associate publisher of Recycling Today and can be contacted at email@example.com.
Making a List
To see the materials Alpha Omega Recycling Inc. accepts at its Texas and Ohio hazardous and nonhazardous materials processing facilities, visit www.RecyclingToday.com/rt0213-alpha-omega-profile.aspx.
When the aluminum producer Alcoa, headquartered in Pittsburgh, was optimistic during the presentation of its 2012 fourth quarter earnings report in early January, Wall Street rallied. As the company sells to a diverse range of industries, this bullishness indicated improved end markets for industries such as aerospace, transportation, housing and packaging.
Alcoa forecasts that global aluminum demand will grow by 7 percent in 2013, a slight increase from 2012’s 6 percent increase.
In discussing the company’s outlook for 2013, Klaus Kleinfeld, Alcoa chairman and CEO, said he expected to see global growth throughout Alcoa’s key sectors in 2013, with aerospace leading the way with 9 to 10 percent growth. He also predicted 1 to 4 percent growth in automotive production; 2 to 7 percent growth in the heavy truck and trailer sector; 2 to 3 percent growth in beverage can packaging; 4 to 5 percent growth in commercial building and construction; and 3 to 5 percent growth in industrial gas turbines.
This projected growth will be driven primarily by China. In fact, according to Alcoa’s presentation, growth prospects for aluminum in Europe are limited to the packaging sector. Additionally, the transportation and building and construction sectors are forecast to decline in Europe in 2013.
On a brighter note, aluminum is making inroads in replacing copper in a variety of applications, including HVAC, consumer electronics and building facades, according to Alcoa. This diversity has created optimism for aluminum markets in the longer term.
Contributing to aluminum’s long-term growth in the transportation sector will be the push to lighten automobiles to improve fuel efficiency. For instance, Land Rover recently introduced the world’s first all-aluminum SUV, the 2013 Range Rover. Additionally, Ford Motor Co. is testing a F-150 pickup truck, which it expects to launch by the middle of this decade. The model features body panels made from aluminum rather than from steel. According to an article in the Wall Street Journal, this move will lessen the vehicle’s weight by 700 pounds.
Overall, the consulting firm Ducker Worldwide says cars will contain twice the amount of aluminum, which will amount to 16 percent of the vehicle by weight, by 2025. The increased use of aluminum is expected to reduce overall vehicle weight by 400 pounds, according to Ducker Worldwide.
Not so Fast
Despite this bright longer-term outlook, a number of challenges currently dull its present outlook. An imbalance in supply and demand continues to be one of the biggest drags on aluminum in the near term. An estimated 1.3 million metric tons of capacity have been removed from the market in the past year. Despite these significant global capacity cuts by many of the largest aluminum producers, a sizable overhang of aluminum production capacity remains, acting like a brake on the market.
New aluminum production capacity was built to capitalize on the growth seen in the housing market during the beginning of this century. However, the subsequent collapse of that market has forced many of the largest aluminum producers to slash production.
During the peak of the housing bubble in 2007, the Australian firm Rio Tinto acquired Canada-based aluminum producer Alcan for roughly $38 billion. Since then, Rio Tinto has been struggling with excess capacity and has been cutting aluminum production in response.
Despite these cuts, Rio Tinto has written down $18.2 billion—nearly half of Alcan’s $38 billion purchase price—since it bought the company. The company says it purchased Alcan at the peak of the market and overpaid for the business.
Bank of America (BoA) Merrill Lynch recently released a report that touches on the global challenges to the aluminum industry. The company estimates that up to 25 percent of the world’s aluminum smelters are unprofitably producing aluminum. “Steady or rising alumina prices on the back of resource nationalism could force much needed aluminum production cutbacks, especially for those smelters that are not vertically integrated,” the BoA Merrill Lynch report states.
A Little Excessive
High inventories of finished aluminum have contributed heavily to the suppression of the aluminum market.
Charles Bradford, a metals analyst with the research firm Bradford Research Group, New York City, says roughly 5 million metric tons of aluminum are inventoried at London Metal Exchange (LME) warehouses, which indicates far more aluminum has been produced than necessary. This is a record level of aluminum in inventory, Bradford says, and with few signs of a robust return in many consuming sectors, he says he feels inventories will be at near-record highs for the foreseeable future.
Low interest rates contribute to the sizable amount of aluminum presently being warehoused. According to one source, financial institutions are purchasing, warehousing and selling aluminum to the futures market. As a result, the metal is being kept out of inventory and being used as a profit center rather than going to consumers, the source says.
A report released by CitiGroup in late 2012 asserts that financial firms hold between 65 and 75 percent of the aluminum stored in LME warehouses.
According to Alcoa, as much as 90 percent of the aluminum inventory that’s traded simply moves around as financed inventory instead of going to customers. “As long as financing is cheap and the forward curve remains steep, it’s unlikely that we’ll see this inventory actually become marketable. This trend will keep volatility high for the foreseeable future,” Matt DiLallo writes in a Jan. 10, 2013, article for the Motley Fool, www.fool.com, that looks at the aluminum outlook for 2013.
Mike Gildea, CEO of Kalamazoo, Mich.-based Schupan Aluminum & Plastics Sales, says the growing presence of financial institutions in the aluminum market continues to have a negative effect on the global aluminum market.
These investing outlets have created an uncertain market for companies that physically handle the metal, whether as scrap or as the finished product.
“Commodities are not based on supply and demand any more,” Gildea says.
While aluminum production and inventories have risen, improved demand has kept this overcapacity from having an overly negative effect on aluminum prices, according to CitiGroup report.
Bradford says that Europe, a key consuming destination for aluminum, will continue to present problems in terms of demand. He speculates that it will be five years before the continent “gets its act together.” However, aluminum producers in Europe will resist cutting too much capacity and reducing employee ranks, he adds.
High electricity costs throughout much of Europe will further hobble that region’s aluminum producers.
The United States, while experiencing a tepid economic recovery, is contending with significant fiscal problems at the federal level. Therefore, the short-term outlook for aluminum during the first half of 2013 is muted.
Aluminum consumption should grow by a modest 1.3 percent in 2013, according to CitiGroup. The tepid growth is attributed to slower economic growth in China and to continued problems with Europe’s sovereign debt crisis.
While economic conditions in Europe and North America will be watched closely, the key factor will be China. In its most recent figures, the International Aluminium Institute, London, reports that China is responsible for close to half of all the aluminum produced in the world. While several economists are forecasting a slower Chinese economy in 2013, other see cause for optimism. The new Chinese government has announced plans to invest $150 billion in infrastructure projects in the country. The investment could significantly boost demand for a range of metals, including aluminum, they say.
Supporting a cautious shorter-term outlook is Svein Richard Brandtzæg, president and CEO of the Norway-based aluminum producer Hydro. In a presentation he gave during the company’s Capital Markets Days 2012, which was held Nov. 29-30 at the company’s Oslo headquarters, Brandtzæg said the current high levels of macroeconomic uncertainty and a multi-speed world economy were weighing on consumer sentiment, which in turn has led to weaker aluminum prices and to softer end markets for the metal.
Brandtzæg said global aluminum demand outside of China would grow from 2 to 4 percent in 2013. Aluminum fundamentals remain promising because of the metal’s many positive qualities, including its light weight and recyclability, he said. Brandtzæg predicted that the global aluminum market would show solid long-term growth of 4 to 6 percent per year during the next 10 years.
“Although aluminium has seen the fastest-growing demand among base metals, we have also seen strong growth in new capacity, resulting in low prices and inadequate returns,” Brandtzæg added.
The author is senior editor of Recycling Today and can be contacted via email at firstname.lastname@example.org.
Regular attendees of the annual Institute of Scrap Recycling Industries Inc. (ISRI) Convention and Exposition have grown to expect a large exhibit hall and a program that offers a considerable number of sessions.
Planners of the 2013 event, to occur April 9-13 at the Orange County Convention Center in Orlando, Fla., promise more of the same, calling it “the largest ISRI Convention and Exposition ever.”
As the ISRI convention dates approach, additional information is available at the event’s website, www.isriconvention.org.
Among the many high expectations ISRI annual convention planners have set for themselves is finding keynote speakers who cause attendees to compete for good seats at these early morning sessions.
Past speakers have included former Presidents George W. Bush and Bill Clinton, former British Prime Minister Margaret Thatcher and U.S. Army General Colin Powell.
At the 2013 convention, on the morning of Saturday, April 13, Tom Brokaw, former “NBC Nightly News” anchor and managing editor, will step to the podium to recount his career in the network news industry.
During his broadcast journalism career, Brokaw worked in Los Angeles, Washington and New York. He and the programs he anchored won Peabody, duPont and Emmy awards.
Six years before retiring as a full-time broadcaster in 2004, Brokaw authored the nonfiction best-seller “The Greatest Generation,” his tribute to Americans who survived the Great Depression and united in the effort to win World War II.
The 1998 book is described by Brokaw as telling the story of “America’s citizen heroes and heroines who came of age during the Great Depression and the Second World War and went on to build modern America. This generation was united not only by a common purpose, but also by common values—duty, honor, economy, courage, service, love of family and country and, above all, responsibility for oneself.”
Brokaw is not the only noteworthy personality making an appearance at the ISRI 2013 Convention and Exposition, as he is joined by a pair of former governors and a winner of 12 Olympic medals.
The morning of Thursday, April 11, former Gov. Ed Rendell (D-Pa.) and former Gov. Haley Barbour (R-Miss.) will offer their perspectives on the current political climate. As well, according to the ISRI convention website, they may help answer the question, “Can a Democrat and a Republican safely share the same stage anymore?”
Barbour and Rendell each served two terms as governor of their states and each has served as chairperson of the two major national political parties. Rendell has offered political analysis on NBC News and MSNBC, while Barbour makes regular presentations for the Leading Authorities speakers’ bureau.
As part of its Just for Fun program, often enjoyed by attendees’ family members who are not involved in the scrap business, 12-time Olympic swimming medalist Dara Torres will offer a presentation.
Torres began swimming in international competitions at age 14 and continued to compete into her 30s and 40s. At the Beijing Olympic Games in 2008, she became the oldest swimmer to compete in Olympic history. According to the ISRI Convention and Exposition website, Torres will offer insight as to how to “stay competitive in a field half your age and about the importance of never giving up on your dream.”
In addition to newsmakers and reporters, the convention will offer considerable programming of direct interest to processors and traders of scrap commodities.
The most commonly traded materials again will be the focus of spotlight sessions in 2013, with the schedule including the following sessions:
ISRI staff members and committee members also are busy preparing programming to cover a wider variety of educational topics, including safety, processing techniques, emerging markets and transportation. When the final program is in place, ISRI says it expects to host some 100 educational sessions.
Electronics recycling is the particular focus of attention Wednesday, April 10, with Electronics Recycling Workshops that run all day from 8 a.m. to 5 p.m.
While most board and governance meetings will occur April 9 and April 10, the Paper Stock Industries (PSI) Chapter will hold its meeting Thursday, April 11, from 3:15 to 5:30 p.m.
Exhibiting it All
Ranging alphabetically from Accent Wire to Young Corp., the 2012 list of exhibitors at the ISRI Convention also covered a broad range of products and services.
This year’s roster of exhibitors promises to be just as comprehensive, as ISRI is taking advantage of its location at the Orange County Convention Center to make available a record amount of floor space.
ISRI says it is expecting more than 300 exhibiting companies in 2013, and buyers and sellers of equipment and commodities will have plenty of chances to interact in the exhibit hall and in meeting rooms throughout the convention center.
Wednesday, April 10, a 6:30 p.m. ribbon-cutting ceremony will mark the opening of the exhibit hall, followed by a Gala Opening event that will last until 9:30 p.m. The three-hour event will offer the first of several opportunities for scrap recyclers to shop for the equipment they’ll need to keep their businesses moving forward in 2013.
Thursday, the exhibit hall is open from 9:30 a.m. to 6 p.m., with lunch being served there from 12:30 to 2 p.m.
Friday’s exhibit hall schedule is similar (9:30 a.m. to 4:30 p.m.), again with lunch being served from 12:30 to 2 p.m.
Outside of the exhibit hall, people wishing to meet up with existing business contacts or to cultivate new ones also will have the opportunity to do so at a variety of receptions that will be held Thursday and Friday evenings, including the Consumers Night Reception from 6 to 7 Friday.
The networking comes to a festive conclusion Saturday night with the Grand Closing Event at Universal Studios.
Those interested in learning more about the 2013 ISRI Convention and Exposition, including how to register and book hotels near the Orange County Convention Center, can visit www.isriconvention.org/registration.html.
Before and After
The 2013 Institute of Scrap Recycling Industries Inc. (ISRI) Convention and Exhibition starts with a series of meetings delving into the details of governance and ends with a party at an amusement park.
For many attendees, the event will not start until the exhibit hall opens with the Gala Opening event Wednesday, April 10, at 6:30 p.m.
However, for the dozens of scrap company owners, executives and managers who volunteer on ISRI committees, April 9 and April 10 will include appointments at board and committee meetings that run those two days.
The bulk of the convention’s programming (as well as most of the exhibit hall hours) occur Thursday, April 11, and Friday, April 12.
Saturday, April 13, attendees who remain in Orlando will be rewarded with the appearance of Tom Brokaw at the Chair-Elect’s Breakfast from 8 to 9:30 a.m. and with additional workshops that run from 10 a.m. to 4:45 p.m.
The convention closes with a bang—or perhaps the wave of a magic wand—Saturday night, when “The Wizarding World of Harry Potter” exhibit at Universal Studios Orlando hosts the Grand Closing Event.
ISRI promises “unlimited access to the incredible rides and attractions in The Wizarding World of Harry Potter, from the streets of Hogsmeade to Hogwarts Castle.” Also included are dinner at Universal’s CityWalk and a desserts reception at Universal’s Islands of Adventure.
More information can be found at www.isriconvention.org/Final_Night_Invitation_Flyer.pdf.
The author is editorial director and associate publisher of Recycling Today and can be contacted at email@example.com.
When it comes to inventory management, Adam Weitsman, owner of Upstate Shredding–Ben Weitsman, headquartered in Owego, N.Y., has a simple philosophy. “We never speculate on scrap,” he says. “We bring our inventories down to the ground each month.”
Another reason Upstate Shredding takes inventory down to the ground each month is because it helps the company discover internal theft more easily, he says. “When you have a small pile, it’s easier to know something is missing,” Weitsman adds.
However, with eight yards currently in operation and an additional four yards scheduled to open in the near future, a considerable volume of material still needs to be accounted for during the course of a month.
Realizing the company could achieve a number of efficiencies and reduce internal theft by better tracking its scrap metals inventory, Upstate Shredding is in the process of installing software specially designed for scrap yards from Woodland, Calif.-based BuyBackPro, Weitsman says.
Additionally, the new software will help Upstate Shredding comply with state regulations pertaining to scrap purchasing that often involve photographing the seller and the incoming material as well as recording the seller’s license plate and ID information.
“We want to be proactive instead of reactive,” Weitsman says.
However, he admits he was “slow to the gate” when it comes to using software to help streamline operations. “It was my fault,” Weitsman says. “I feared change. I am not as computer literate as I should be.”
Counting the Benefits
Weistman says that by introducing software the company is seeking to lessen human error and improve operational efficiencies. “We were not doing as many inventory counts as we should and not managing the yards as well as we should,” he says of Upstate Shredding’s manual approach to inventory management.
Kevin Deet, IT manager for Upstate Shredding–Ben Weitsman, says the software has been installed at four of the company’s locations as of mid-January.
Before joining Upstate Shredding, Deet worked for another scrap yard where software was integral to the company’s operation. He says he saw two major benefits as a result: the simplified aggregation of uniform information as well as an endless variety of reporting capabilities. “Data was far more reliable and easy to get at for the business decisions that needed to be made,” Deet says. “You’re working on near-real-time data rather than hunches.”
He says software’s inventory tracking capabilities also can help to reduce a common error when inventory management is done manually: selling the same pile of scrap to three different customers. It can also help prevent the problem of material not being added to inventory because an employee failed to record the data.
“The fact of the matter is that when we bring in people who are expert at grading metal, they might not have a clerk skill set that lends itself to entering information into Excel or creating an inventory on a legal pad,” Deet adds.
While Upstate Shredding’s employees who are buying and grading scrap might not have the skills required of a clerk, Deet says the software learning curve is easily managed. The software’s interface is simple for a front-end user to learn. “No computer experience is required to buy the scrap and to regrade it,” Deet adds. However, the program offers a “powerful” SQL (structured query language) database for the office staff that enables the data to be queried in a variety of ways, he says.
Among the reports Upstate Shredding’s office staff can create is a Metals Position report, which details the metals the company has in inventory across all of its yards that are running the software. This information can then be compared to the book of sales for individual yards or for the company as a whole, so Upstate knows whether it needs to purchase more scrap to fulfill its orders.
Tracking Upgraded Material
Software also can help a scrap yard keep better track of material as it’s upgraded, giving an operation better insight into costs, Deet says. Without such a tool, he says, “It is near impossible to take the amount of processing and upgrading that we do into account to come up with close estimates as to average scrap cost.”
Rather than use a work-in-progress category for metals undergoing upgrading, in the case of nonferrous metals, Upstate is waiting until it has a finished Gaylord container full of prepared scrap. That full container will be weighed, and the weight and description of the finished metal will be entered into the company’s inventory, Deet says. The purchased product and the final, upgraded product will have separate ticket numbers in the company’s system, he adds. Therefore, pounds that flow through the yard may change item codes and ticket numbers as they undergo processing. For instance, if Upstate buys 1,000 pounds of dirty yellow brass and upgrades 800 pounds to yellow brass, with the remaining 200 pounds being iron, the company’s inventory can be adjusted easily with a couple of key strokes.
A secondary benefit to knowing its metals position is being alerted to cases of potential internal theft. This issue was among the concerns that led Upstate Shredding–Ben Weitsman to buy software for its scrap processing operations, Weitsman says.
Deet adds that the company anticipates the software will make a considerable difference in this area. “What we have is going to heavily prevent the falsification of tickets,” he says. “It doesn’t mean it can’t happen, but it makes it less of a risk; it gives us an audit trail.”
Of course, there are potential benefits in terms of complying with legislation designed to limit materials theft, as well. Deet says the company recently received a subpoena for tickets for scrap metals it purchased from four individuals. An employee spent a couple of hours daily for a number of days searching through Upstate Shredding’s tickets looking for purchases from these individuals and photocopying those tickets. Once the software is fully operational, however, Deet says Upstate will be able to produce this type of information within minutes.
“We can have that information and convert it into a PDF file inside of three minutes,” he says. In such cases, Upstate will be able to query the ticket history file using the name of the individuals in question. This will pull a ticket report that lists the dates, times and locations where the transactions occurred and also will include pictures of the sellers’ vehicles, drivers’ licenses and the materials.
Deet says the software will help to “create many efficiencies when trying to get at data and audit trails.” He adds, “From a customer and vendor standpoint, it will enable us to give easy and accurate service. It will add to our professionalism and enhance our response time to customers, vendors and law enforcement.”
The author is managing editor of Recycling Today and can be reached at firstname.lastname@example.org.