The Institute of Scrap Recycling Industries (ISRI), the Washington-based trade association that describes itself as “the voice of the recycling industry,” hosted its 2014 Convention & Exposition April 6-10 at the Mandalay Bay Convention Center in Las Vegas. The annual event attracted nearly 6,000 scrap recycling industry professionals and manufacturers from all 50 states and more than 40 countries to discuss the latest in the global scrap recycling business, according to ISRI.
Attendees at the 2014 ISRI Convention & Exposition had the opportunity to participate in workshops, sessions and interactive panels examining opportunities and challenges in the recycling industry in addition to commodity-specific “spotlights” that featured expert analysis and opinions on secondary commodity markets. ISRI says programming was focused on helping companies operate smarter, more safely and more profitably.
Among the highlights of the 2014 ISRI Annual Convention & Exposition were Apple co-founder Steve Wozniak, who spoke as part of the Distinguished Speaker Series, and presentation of the ISRI-JASON Learning National Student Poster and Video Contest winners. The contest, part of the partnership between ISRI and JASON Learning to promote recycling within the K-12 STEM (science, technology, engineering and math) curriculum, called on students to design a poster or video encouraging responsible recycling of cellphones.
ISRI says responsible recycling and certification were a major focus of the convention, which featured numerous Recycling Industry Operating Standard (RIOS) certification training sessions and workshops.
Certification dollars and sense
Customers seeking electronics recycling services likely will be assured by all potential recyclers that their companies are doing things properly. Panelists at a session at the 2014 ISRI Annual Convention & Exposition said facility certification provides the necessary verification that can earn the business of these customers.
Both panelists at the session were familiar with ISRI’s RIOS (Recycling Industry Operating Standard) certification as well as with R2 (Responsible Recycling Practices) electronics recycling certification. R2/RIOS is one of two focused certification systems available to electronics recyclers. (The other is e-Stewards, created by Seattle-based Basel Action Network.)
Bob McCarthy, director of business development and training at Minnesota-based electronic recycling auditing firm Greeneye Partners, said he became convinced of the merits of certification in his previous job at an electronics recycler. McCarthy said he tried to convince potential customers that, unlike some of its competitors, the company was “doing it the right way,” but “our competition claimed to also. I was competing on price every time.”
In 2008, the company McCarthy worked for received its R2 certification. “That was our game-changer,” he said. “It took us from being another ‘me too’ to being the expert in the room.”
He said certification talking points include assurances of data security, restrictions on “black market” reuse sales and restrictions on shipping some obsolete devices overseas.
“Your goal should be to eliminate your customers’ risks,” McCarthy said.
He told session attendees that following through on certification would prove rewarding. “It’s not a cost—you’re making money,” he said of certification.
Rike Sandlin of Oklahoma-based HiTech Assets Inc. said his company has seen several bottom-line benefits since obtaining R2/RIOS certification. “Within six months [of obtaining R2/RIOS certification], the quality improvements we experienced paid for the RIOS process.”
Processes “built into RIOS” also helped HiTech fully tap into global trade for the secondary commodities (metal and plastic scrap) that it produces, Sandlin said.
He also said many opportunities are available to HiTech only because of its certification. “Many RFPs (requests for proposals) are requiring R2/RIOS,” he said. “Ultimately, it’s about competitive advantage,” Sandlin concluded.
Economics at issue
Other issues facing electronics recyclers were discussed in the Spotlight on Electronics session Tuesday, April 8.
The panel, moderated by Jim Levine of Regency Technologies, with operations in Ohio, Atlanta and Chicago, featured Joe Clayton, vice president of sales and marketing for MRP Co., Hunt Valley, Maryland.; Dag Adamson, president and founder of Lifespan Technology Recycling, Newton, Massachusetts; and Craig Boswell, president and co-founder of Hobi International, Batavia, Illinois.
Levine began the discussion by raising the issue of glass from CRT (cathode ray tube) devices, saying, “Everyone thinks it’s going to go away some day, but it keeps coming and coming.”
Clayton said the only thing lacking when it comes to processing CRT glass is the willingness to pay for the service, adding that sufficient capacity exists to handle the material that is being generated.
Boswell also said he saw the problem as an economic one, adding that recyclers have gotten into trouble because they did not adequately price for handling this material. He said the charge is now built into the pricing model in the business-to-business environment.
Regarding OEM (original equipment manufacturers) contracts, however, Clayton said this was not always the case. “I walked away from an OEM contract because it didn’t pay me enough to do good,” he said.
His response led to a follow-up question on the effect of EPR (extended producer responsibility) legislation on the industry.
Adamson said such legislation has resulted in OEMs searching for processing partners based on cost rather than value. He added that Lifespan has walked away from such contracts in multiple states with EPR laws because the economics were “just not there.”
“The biggest problem with EPR is the huge leakages that no one is looking at,” Clayton said. “Freight costs are eating up a lot of money because OEMs only want to talk to the largest [recyclers.]”
Emerging e-scrap markets
Overseas processing of electronics has long been a concern of domestic electronics recyclers, and the panel, Going Global, discussed the movement in emerging countries such as Kenya, Africa, to establish a regulatory model for e-scrap recycling.
Katharina Kummer Peiry of Kummer Eco-Consulting, Switzerland, moderated the session, featuring Ireland-based Jean Cox Kearns of Dell Corp.’s Global Take Back program; Venkatesha Murthy of the Singapore consulting firm Vans Chemistry PTE Ltd.; and Eric Harris, director of government and international affairs for ISRI.
Cox Kearns related Dell’s ongoing efforts to build recycling infrastructure in many emerging markets, including Kenya.
“Collection is not a problem in these countries,” said Cox Kearns. “The problem is, what do they do with it after collection?” She said media attention to rudimentary recycling operations in emerging markets is highlighting detrimental impacts to the environment as well as to people’s health and safety.
One of Dell’s ongoing efforts in Kenya is the E-Waste Solutions Alliance for Africa, a two-year-old initiative that also includes partners Hewlett-Packard, Nokia and Philips. The companies have worked to develop a regulatory model for electronics recycling for developing countries.
Cox Kearns said the alliance has worked with a U.K.-based recycler to establish a recycling facility in Nairobi, Africa. East Africa Compliant Recycling, described as the region’s first large-scale e-scrap recycling plant, began operations in late 2013, according to a Dell press release.
The alliance also has worked with several Kenyan government ministries to develop regulations for this emerging market, supporting the industry and its employment and opening the door for other recyclers, Cox Kearns said.
“We now have a model we hope will become one that can be copied across other markets, with some tweaking,” she said.
In his presentation, ISRI’s Harris said a critical issue for emerging markets building their recycling industries is the classification of secondary materials that will be moved across national borders in a way that allows for the return of commodity-grade materials to the global marketplace.
“How we allow those materials to be moved, through a classification or a defined model, is critical for this industry,” Harris said. This has become even more important, he said, as the Basel Convention, the international agreement regulating transboundary shipments, now includes such materials as consumer electronics, used medical equipment and used automobiles.
Harris also raised the issue of producer responsibility and how recycling costs could be covered in various emerging markets, particularly since some streams “have a negative cost to recycle,” he said.
“We know it isn’t a one-size-fits-all solution,” Harris said, explaining that what works in Europe or the U.S. may not necessarily work in emerging markets such as Africa, South America and Asia.
Aluminum market curiosities
The Spotlight on Aluminum took a closer look at the forces influencing the global market for this nonferrous metal.
Global finished and primary aluminum prices have been relatively stable in the past 12 months, but aluminum in the U.S. Midwest has gained in value, providing one of many market curiosities discussed by Aluminum Spotlight session panelists.
Moderator Matt Kripke of Kripke Enterprises, Toledo, Ohio, said the Midwest Premium price of aluminum has surged as high as 17 cents per pound against London Metal Exchange (LME) primary aluminum pricing in 2013 and early 2014.
Panelist Mike Southwood of London-based information services company CRU said the wider spread was tied to an aluminum supply deficit in the United States that CRU estimates at some 3.5 million tons per year. “We consume more aluminum than we produce,” Southwood said of the U.S., adding that “production has not kept pace” with demand that has rebounded since the end of the subprime mortgage crisis and recession of 2008 and 2009.
He said the supply deficit could be closed with imports from places such as Russia and the Middle East or by tapping into inventories in LME warehouses.
Regarding the latter option, aluminum consumers have protested the perceived snail’s pace process of retrieving aluminum from LME warehouses in the U.S., most notably the warehouse in Detroit.
News reports have pointed to waits as long as 18 months to remove aluminum from the Detroit LME warehouse.
Southwood said the Midwest premium is likely to shrink throughout 2014 as owners of physical inventory have been tapping into their warehoused supplies. He said some 79 percent of the aluminum in the Detroit warehouse has been requested for delivery by its owners, “an all-time high.”
Globally, Southwood said CRU saw strong demand for aluminum in a rebounding world economy as helping to push LME prices higher in “a gradual and modest rise” in 2014, with aluminum prices averaging $1,762 per metric ton during the year.
Fellow panelist Edward Meir of INTL FCStone, Stamford, Connecticut, said aluminum industry surpluses in China could restrain higher pricing in 2014. Producers in China, Meir said, “have the capacity to produce 45 million metric tons—all the aluminum [consumed] in the world.”
Meir said his sources indicate that half of the aluminum smelters in China are losing money and that the government is becoming increasingly reluctant to provide subsidies. If the Beijing government is serious about letting the market determine winners and losers in the aluminum sector, said Meir, it will go a long way toward solving the overcapacity issue.
Despite his concerns about China’s overcapacity, Meir forecasted a 2014 average figure of “about $1,800” per metric ton for aluminum on the LME, spurred in part by stronger U.S. demand. “After three years of bear markets, I think we’re on the mend,” he said.
A shoe that didn't fit
The ISRI 2014 Convention & Exposition concluded with an address by former first lady, U.S. Senator and Secretary of State Hillary Clinton. An interruption during her speech attracted national attention.
Several minutes into Clinton’s presentation, a woman approached the stage and threw a shoe and several pieces of paper at Clinton. The thrown objects missed Clinton, who initially expressed confusion before joking about the substandard aim of the shoe thrower.
In her presentation and in a question-and-answer period afterward, Clinton approached a wide variety of topics, including America’s global competitiveness.
Clinton said America is “better positioned than any of our competitors to seize the challenges” facing the world.
She referred to America’s “broken immigration system” as one of its challenges, saying immigrants contribute to a “culture of creativity and risk taking” that has helped build America.
In the question-and-answer period with ISRI Chairman Jerry Simms, the first question (fittingly after the thrown shoe) dealt with civility in politics and public discourse. Clinton said she had “a serious problem with people who run for office claiming they will never compromise. That’s not how democracy works. It’s rare that you get everything you want.”
Pointing to the positives of compromising, Clinton cited the 2014 budget deal struck in late 2013 between Republican Rep. Paul Ryan and Democratic Sen. Patty Murray. She said the two “certainly spent time listening to each other,” which Clinton said has become disappointingly rare.
In one portion of Clinton’s presentation that touched on the topic of solid waste and recycling, she described a Clinton Climate Initiative program in Delhi, India. She referred to the project as the city’s “first integrated solid waste management system” and said it was diverting tons of plastic scrap each year from landfills and had “given a lot of people good jobs.”
At the start of the session, 2014 ISRI Convention Chairman Stephen Moss invited those in attendance to make plans for the ISRI 2015 Convention & Exposition, to be held in Canada at the Vancouver Convention Centre.
Incoming ISRI Chairman Doug Kramer also delivered comments. He praised the accomplishments and guidance of outgoing ISRI Chairman Jerry Simms and said that, as with Simms, greater ISRI safety program participation and a better industry safety record will be among the top priorities in his new role.
Additional coverage of the ISRI 2014 Convention & Exposition is available online at www.RecyclingToday.com.