Irving, Texas-based Commercial Metals Co. (CMC) has announced financial results for its fiscal 2020 third quarter ended May 31. Quarterly earnings from continuing operations were $64.2 million, or 53 cents per diluted share, on net sales of $1.3 billion compared with prior-year-period earnings from continuing operations of $78.6 million, or 66 per diluted share, on net sales of $1.6 billion.

The company incurred a $6.2 million net after-tax charge for facility closure expenses and asset impairments primarily related to the curtailment of a West Coast fabrication facility in the third quarter. CMC says this decision was made in accordance with its ongoing network optimization efforts and is expected to provide cost benefits in future periods. Excluding these expenses, adjusted earnings from continuing operations for the three months ended May 31 were $70.4 million, or 59 cents per diluted share. This compares with adjusted earnings from continuing operations of 67 cent per diluted share for the three months ended May 31, 2019, the company notes.

Barbara R. Smith, Chairman of the board, president and chief executive officer of CMC, says, "While the effects of the COVID-19 crisis impacted our business throughout the third quarter, CMC acted early and swiftly to ensure the safety of our employees, the continuity of our operations and the uninterrupted service to our customers. Our entire organization can be proud of these efforts and their results. We were able to keep our workforce fully employed and safe. We also avoided any meaningful disruptions to operations and experienced no loss of productivity while closely following CDC (Centers for Disease Control and Prevention) guidelines at all of our locations."

She adds, "In the face of unprecedented global uncertainty, we concentrated our focus on the elements of our business within our direct control. Because of these efforts, CMC achieved sequential earnings growth while increasing our market share in many products, continuing to reduce our operating costs and further strengthening our balance sheet. Our success during the quarter underscores several of CMC's best qualities—a robust business model, focus on providing best-in-class customer service and commitment to our employees."

CMC says its liquidity position as of May 31 strengthened further, with cash and cash equivalents of $462.1 million and availability under the company's credit and accounts receivable facilities of $604.2 million.

On June 16, the board of directors declared a quarterly dividend of 12 cents per share of CMC common stock payable to stockholders of record July 6. The dividend will be paid July 20 and marks 223 consecutive quarterly dividend payments, the company says.

CMC’s Americas Recycling segment recorded an adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) loss of $1.7 million for the third quarter of fiscal 2020 compared with adjusted EBITDA of $12.3 million for the prior year’s quarter. The reduction reflected a challenging environment of lower shipments and decreasing average selling prices, the company says. Volumes were affected by sharply reduced demand from third-party mill customers. Inflows of material to the company’s yards were slowed by broadly weak manufacturing activity and low prices that disincentivized collection of obsolete scrap. Compared with the year-ago period, ferrous shipping volumes and selling prices were down 21 percent and 15 percent, respectively.

CMC’s Americas Mills segment recorded adjusted EBITDA of $133.2 million for the third quarter of fiscal 2020, a decrease of 16 percent compared with adjusted EBITDA of $158.1 million for the third quarter of fiscal 2019. Despite the impact of COVID-19 on the U.S. economy, volumes declined only 4 percent compared with the prior-year period because of continued strength in construction activity, CMC says. Metal margins contracted by $19 per ton year over year, as the $64 per ton reduction in average selling price was only partially offset by lower scrap costs. Results in the third quarter of fiscal 2020 benefited from what CMC says was the best conversion cost performance since its November 2018 rebar asset acquisition. Conversion costs per ton were 7 percent below the postacquisition average.

The company’s Americas Fabrication segment recorded adjusted EBITDA of $31.9 million for the third quarter of fiscal 2020, marking a significant improvement from an adjusted EBITDA loss of $23.3 million for the third quarter of fiscal 2019 primarily because of expanded selling price margins over rebar cost, CMC says. The third quarter of fiscal 2020 marks the segment's best quarterly profit performance in nearly 12 years and highlights the beneficial impact of the fixed-price contract backlog of its fabrication business during a period of economic slowdown. As in prior quarters, third quarter adjusted EBITDA did not include the benefit of the purchase accounting adjustment related to amortization of the acquired unfavorable contract backlog reserve of $4.4 million. The trend of year-over-year increases in selling price continued during the quarter, as CMC shipped at an average price of $966 per ton. This represented a significant rise of $41 per ton, or 4 percent, compared with the prior year period, according to the company. Backlog remains strong in relation to quantity and pricing.

CMC’s International Mill segment in Poland recorded adjusted EBITDA of $14.3 million for the third quarter of fiscal 2020 compared with adjusted EBITDA of $24.1 million for the prior-year quarter. Metal margins were affected by continued import pressure. Despite market challenges caused by COVID-19, CMC says shipment volumes decreased only 1 percent on a year-over-year basis, driven by resilience in the Polish construction sector and market share gains in merchant products.

"We expect construction and infrastructure activity to remain resilient during our fiscal fourth quarter," Smith says. "Our finished product volumes are supported by strong fabrication backlogs, which stood near record-high levels at May 31. Customers' sentiment about their own summer construction workloads is also encouraging. CMC's net debt-to-EBITDA ratio of 1.2x and substantial cash and equivalents on hand give us great confidence in our ability to withstand these challenging times and provide us with significant flexibility in our capital allocation decisions."

Commercial Metals Company and its subsidiaries manufacture, recycle and market steel and metal products, related materials and services through a network of facilities that includes seven electric arc furnace (EAF) minimills, two EAF micromills, two rerolling mills, steel fabrication and processing plants, construction-related product warehouses and metal recycling facilities in the U.S. and Poland.

Global metal and plastic recycler European Metal Recycling Ltd. (EMR), which is headquartered in the U.K., has launched its sustainability strategy, which establishes its target of net-zero carbon emissions across its entire value chain by 2040.

Our Decade of Action details the measures EMR will take over the next 10 years on its journey to become carbon net-zero across the group with key targets and milestones.

The strategy establishes a 2030 net-zero target for indirect emissions created by the purchase of electricity or steam, defined as Scope 2 emissions under the Greenhouse Gas Protocol, and a 2040 target for direct emissions from all owned and/or controlled sources and indirect emissions upstream and downstream in the value chain, defined as Scope 1 and Scope 3 emissions, respectively.

To drive progress toward groupwide net-zero carbon emissions by 2040, EMR says it has joined three key initiatives from the nonprofit The Climate Group, with European offices in London. These include RE100 to accelerate the transition to renewables, EV100 to switch to electric vehicles and EP100 to improve energy productivity across its global portfolio.

EMR says its net-zero commitment is underpinned by targets set out in four pillars: renewable electricity, energy productivity, movement of people and material handling and movement.

The 2030 targets for each of these pillars include:

• 100 percent of operations operating on renewable electricity;
• the electrification of 100 percent of cars and light commercial vehicles and 50 percent of small goods vehicles;
• committing to procure 20 percent of new site-based fixed and mobile plant that is powered by electrical, hybrid, fuel-cell or biofuel sources; and
• 10 percent energy productivity improvement for total kilowatt per ton of material handled.

The company says all of its targets apply to its operations worldwide and are aligned to its vision of becoming a global leader in the provision of sustainable materials.

Chris Sheppard, EMR Group CEO, says, “Our Decade of Action marks the start of an exciting journey for all of us at EMR. We’re proud to set out our commitment to tackling climate change and conserving natural resources with a series of ambitious, groupwide targets.

“Using recycled materials to create new products has a huge environmental impact, saving between 50 percent and 90 percent of the energy and water consumed when creating the virgin equivalent. We recycle around 10 million tonnes of metals and plastics every year, resulting in savings of around 10 million tonnes of CO2,” he continues.

Sheppard adds, “However, our products don’t come without some environmental cost. Imagine being able to say that we create these sustainable materials with a net-zero carbon footprint? To achieve this, we need to go on a journey that explores new technologies and ways of working, to design carbon out of our business.

“Now more than ever, improving environmental performance while supporting people and businesses to be more sustainable is essential,” he says. “Committing to decarbonisation is key to driving the green recovery of the global economy in a post-COVID world, creating jobs and driving investment while delivering on global climate objectives.”

Sheppard concludes, “As a global business and a family company, we have a responsibility to minimize our impact and help build a circular economy where both people and the environment can prosper. Authentic change requires authentic efforts to implement more sustainable operations. If you put your mind to this, it’s amazing what you can achieve. We’ve already transitioned 80 percent of our U.K. energy usage to renewable electricity and we already have plans to go further faster.”

EMR’s Sustainable Business Strategy can be accessed here.

Container shipping firms Hapag-Lloyd and Mediterranean Shipping Co. (MSC) reportedly have indicated they will no longer accept scrap metal or paper as cargo to ports in the People’s Republic of China.

A report on the New York-based Maritime Logistics Professional website indicates Switzerland-based MSC announced in early June that it would stop accepting such shipments, while Germany-based Hapag-Lloyd has set a Sept. 1 deadline for accepting scrap cargo to China.

The online report indicates a mid-June Hapag-Lloyd notice makes references to a law passed in April in China that will take effect in September. That law, according to this notice, “holds carriers and importers responsible for the return and disposal of ‘solid waste’ that fails to meet import requirements.”

The same notice uses language that puts secondary commodities into the “waste” category, including “cargo such as waste paper, waste plastics, waste metals, waste chemicals, etc.”

The shipping line announcements add one more layer of confusion to a scrap import landscape in China that has been opaque and confusing for buyers, shippers and traders alike throughout the first half of 2020.

Agencies of China’s central government have indicated at various times that they will ban all scrap imports at the end of 2020, but they also lowered the tariff on nonferrous scrap shipped from the United States in April. China’s government may reclassify some types of nonferrous scrap as resources rather than “waste,” and that they are considering doing the same for some types of ferrous scrap.

But in mid-June, Chinese government agencies raided several recycling facilities and issued statements again indicating hostility to imported secondary commodities, referring to them as “illegal trash imports.”

Recyclers are increasingly reluctant to ship even high-grade copper and aluminum scrap to China until its government puts the new “resource” designation in place, and shipping lines are now showing the same disinclination.

“The lack of transparency and definitive lines of regulator responsibility are very difficult to discern, which only adds to the opaque nature of the present situation,” Michael Lion tells Recycling Today. Lion is a trader with Hong Kong-based Everwell Resources Ltd. and is chair of the International Trade Committee of the Brussels-based Bureau of International Recycling (BIR).

Says Lion of the potential new resource categorization for high-grade nonferrous scrap, “As of this moment [there] appears to be no definitive timeline for the new regime to commence; this may have abundant reasons, not least the [lack of] implementation procedures and necessary training to undertake them.”

Another Hong Kong trader said his contacts have told him the nonferrous scrap as a resource specification has been published, but customs agency personnel are not fully briefed on it. Scrap buyers in China “are nervous to commit” as of late June, he adds, but they still think high-grade copper and aluminum scrap will eventually be upgraded to a resource category from a “waste,” possibly as soon as early July.

Some China-based metals producers have invested to melt scrap in Southeast Asia so they can instead ship ingots to China, and two recent investments announced in the United States—one in North Carolina and the other in Ohio—would increase its ability to melt more of its own copper scrap domestically.

In the paper sector, Hong Kong-based Nine Dragons Paper Ltd. is among the companies with operations in China that have invested to convert scrap paper sourced in North America into a pulp product it can ship into China.

A research project at the University of Louisville (UofL) in Kentucky is focusing on developing a method to sequester and convert carbon dioxide (CO₂) emissions into usable products. The project, which entails developing CO₂ catalysts, is being funded by the Catalysis Program of the Chemistry Division of the National Science Foundation (NSF).

The research has the potential to decrease CO₂ emissions by creating what UofL calls “a profitable pathway to convert this waste into marketable industrial chemicals such as solvents, alcohols, acids and polymer precursors.”

Critical to the research is the development of new catalyst materials using the principle of cooperativity to capture CO₂ and convert it to fuels and chemical products. The catalyst will employ an abundant metal, possibly zinc, within a supporting framework. “The catalyst works synergistically with an alloy electrode to generate higher value products,” states UofL.

“The technology from this research could be used to treat CO₂ from fossil fuel combustion directly at the source,” says UofL chemistry professor Craig Grapperhaus. “We may even be able to directly convert atmospheric carbon dioxide, too.”

Grapperhaus is leading the research, along with Joshua Spurgeon, theme leader for Solar Fuels at the Conn Center for Renewable Energy Research in the J.B. Speed School of Engineering at UofL.

“The thoughtful design of molecular catalysts such as these gives us the opportunity to achieve greater control over the products we make, which may ultimately make chemicals and fuels from CO₂ commercially viable,” says Spurgeon. “The Conn Center is excited to collaborate with the Department of Chemistry and NSF to develop these advances in green, sustainable chemistry.”

More than $320,000 over three years will be invested in the project, which UofL says will provide research opportunities for undergraduate, graduate and high school students.