José Cayuela Avilés founded Grupo Ferromolins, which is headquartered in Barcelona, Spain, in 1988 after more than 40 years of experience in the metals recycling sector. Under his leadership, Ferromolins prioritized continual improvement and innovation. That tradition continues today at the family-owned company under the leadership of his daughter, Lidia Cayuela Lopez, who serves as president.

Natalia Cruz Cayuela, Lidia’s daughter and José’s granddaughter, is the third generation of the family to work in the business. She joined Ferromolins two years ago and serves as purchasing and sales manager for ferrous and nonferrous metals.

Natalia says she grew up in the family business but sought additional education and experience outside Ferromolins before officially joining the company, helping to lead Ferromolins into its next decade. “I studied business administration, learning different languages and working in several companies, always in the international sales area, before joining Ferromolins.”

In her experience outside the company, Natalia says she learned that a good team is essential to a company’s success. “And that’s what I found when I joined the company.”

In addition to a well-established team, Natalia inherited her grandfather’s relationship-focused approach to business. “My grandfather used to say, ‘We want to build solid, long-lasting relationships with our customers.’”

Natalia also says Ferromolins is not afraid of failure, adding that the company understands failure ultimately can lead to success, particularly today, when the pace of change necessitates quickly responding to suppliers’ and consumers’ new and evolving needs. “It’s important to fail often so that you can succeed sooner,” she says. While it is important for Ferromolins to be strategic in its new endeavors, she says the company learns from its mistakes, which makes it “sustainable and flexible.”

Modern methods

Ferromolins has modernized along with the larger scrap industry over the last three decades and considers itself a pioneering company within Spain’s ferrous and nonferrous recycling sector, Natalia says. Its recovery and recycling plants are equipped with modern infrastructure and next-generation technology to manage large volumes of material quickly.

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The company operates six facilities. Its Barcelona headquarters focuses on processing aluminum and copper wires and cables. “We have three production lines working 24 hours per day with an average production of 1,200 metric tons per month of granules,” Natalia says.

Ferromolins’ other processing facilities are in Seville, Castellbisbal and Zaragoza, Spain. The company also operates logistical centers in Mallorca, Spain, and on the Canary Islands, a Spanish archipelago off the coast of northwestern Africa.

It offers logistical services throughout Spain, the south of France and Portugal, Natalia says.

Wire processing accounts for roughly 90 percent of Ferromolins’ business. Its other services include dismantling and recycling of transformers, condensers and electrical switches at its plant in Seville; ferrous and nonferrous scrap processing; and integrated management for scrapping and decommissioning of industrial plants, thermal power and hydropower plants, electricity substations and other industrial facilities throughout Spain and across Europe.

Ferromolins’ Seville location serves southern Spain and Portugal. “Besides ferrous and metal transformation, we have there located the PCB (polychlorinated biphenyl) decontamination plant for electric devices,” Natalia says. “This process is unique and offered to the main electric distribution companies in south Europe.”

The Seville location employs a proprietary technology that Ferromolins developed to handle the PCBs in the transformer oil.

All the company’s processing facilities are equipped with the shearing, packing and material handling equipment to handle ferrous and nonferrous scrap, Natalia says.

“At the end of the process, a quality laboratory ensures the grades of all the products coming out of our six yards,” she says.

The company says its commitment to the environment leads it to heavily invest in research and development. Ferromolins also has created an integrated quality, environmental and health and safety management system and has obtained ISO 45001, ISO 14001 and ISO 9001 registrations. It also complies with End of Waste criteria under EU333 (for iron, steel and aluminum scrap) and EU715 (for copper scrap), Natalia says. End-of-waste criteria specify when certain waste materials cease to be waste and become a product or a secondary raw material.

A selective buyer

Natalia says Ferromolins is “focused on quality,” adding that 95 percent of the copper and aluminum chops the company produces are considered “1A grade.” She explains, “To reach that goal, we are only sourcing directly from industrial rejects.”

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High quality is the company’s overall goal for all the products it produces. “For Ferromolins, quality is a must,” Natalia says. “It is the only way to be in the market.”

She adds that all the company’s 80 employees are trained to understand they each have roles to play in ensuring the quality of the products Ferromolins produces.

The company sources scrap globally, though Natalia says the quality of the incoming material is more important than the country of origin. That being said, she adds, “[The] U.S. market is nowadays very important for us in the sourcing side.”   

Ferromolins’ prepared scrap is sold globally, Natalia says, though “a great part of our sales is Europe based.”

Marketing material

Despite the quality of the products Ferromolins produces, movement and pricing have been challenged given China’s restrictions on scrap imports and their effect on global trade, Natalia says. “There is strong stress on copper prices because of [the] global market situation, and secondary aluminum is also very affected locally because of low demand [from] the local automotive industry.”

She continues, “From my point of view, final consumers of recycled materials demand more and more homogeneous and high-grade qualities,” which means the recycling industry must make investments to meet those requirements. However, she adds, “Secondary materials are essential to industry’s survival.”

Natalia says, “Now are confusing times for volume forecasts and pricing.”

That already confusing situation has been further affected by the novel coronavirus pandemic, which has disrupted industrial supply chains. Prior to the outbreak, demand in Europe was low, she says, and the pandemic has the potential to worsen the situation as European carmakers temporarily cease production in response to the global health crisis.

CNN reports that three of Europe’s largest automakers, Fiat Chrysler, PSA Group and Renault, are closing manufacturing plants across the region. Even before those announcements, the auto sector in the region had been heading for a third consecutive year of falling sales.

Among the three companies, 35 manufacturing facilities across Europe will be closed in response to regional and national authorities’ imposition of restrictions on travel and public life, CNN says.

The overall effect on Ferromolins and the scrap processing sector at large has been a tightening of margins. Natalia says the company is responding the only way it knows how, by focusing on quality and productivity. “We are very confident in the future on that side since our plan for company growth is very organic and adjusted to the present situation. We have built a very professional team that assures the viability of our product based on technology, skills and service.”

Cleveland-based Aleris Corp. has reported a $28 million loss for the fourth quarter of 2019, knocking the secondary aluminum producer and aluminum rolling firm into the red for the year, with a $12 million net loss.

Despite the net loss figures, the company also is claiming an “adjusted EBITDA [earnings before interest, tax, depreciation and amortization] of $388 million in 2019,” which it compared favorably to the $276 million earned in 2018. The company cites its debt service obligations and “a $31 million unfavorable change in unrealized derivative gains and losses” as factors in its net loss.

“In 2019 we saw the first full year of the earnings growth expected from our long-term strategy of investing in aerospace and automotive capabilities across the globe, as we delivered another record quarter [that] contributed to a 40 percent increase in adjusted EBITDA on a full-year basis,” says Sean Stack, the company’s chair and CEO.

While the company’s North America income grew in the fourth quarter of 2019 compared to the year before, it fell in Europe by $6 million. Aleris’ net 2019 fourth quarter income also rose in its Asia-Pacific operations.

Looking ahead to 2020, Stack comments, “In addition to dealing with heightened market uncertainties associated with the coronavirus, we already anticipated some softening in demand in 2020 in the aerospace and automotive end uses and additional pressure from common alloy foreign imports in North America.”

For 2020 Aleris also says it expects “lower global automotive volumes based on continued demand softness in Europe.”

Overhanging Aleris’ 2019 results and its future is its proposed acquisition by Atlanta-based Novelis Inc., which is part of India-based Hindalco Industries Limited.

Notes the company, “On July 26, 2018, we announced that we entered into a definitive agreement to be acquired by Novelis [for] approximately $2.6 billion, including the assumption of the company's outstanding indebtedness.”

As of March 2020, reports the firm, “The merger is subject to customary regulatory approvals and closing conditions. There can be no assurance that the merger will be consummated.” Aleris says additional detail on the proposed merger can be found in the Form 8-K filed back in July 2018.

The Global Recycling Foundation announced the kick off of Global Recycling Day 2020 by honoring heroes in the recycling industry. The theme for 2020 is #RecyclingHeroes – recognizing the unsung heroes in the recycling industry and the children, schools, teachers, professionals, businesses and communities that champion recycling around the world. The Global Recycling Foundation is encouraging everyone to nominate their #RecyclingHeroes and highlight the incredible work that is carried out by local communities and individuals.  

"Although the world rightly focuses on its response to COVID-19, we encourage people around the world to remember the importance of recycling and to recognize the individuals, communities and businesses – some world renowned some unknown - who are the forefront of recycling innovation and best practice," the foundation says in a statement.

An initiative of the Global Recycling Foundation, Global Recycling Day is a movement dedicated to recognizing the importance of recycling as a resource, not waste. Now in its third year, the day was launched in 2018 to help recognize, and celebrate, the vital role recycling plays in preserving our precious primary resources, lowering global carbon emissions and securing the future of our planet.

The winners of the #RecyclingHeroes social media competition will also be announced today. The Global Recycling Foundation received more than 2,000 nominations from across the world and ten winners are set to receive a prize of $1,000 each to contribute towards their recycling initiatives.

Ranjit Baxi, president of the Global Recycling Foundation, comments:

“Even in these uncertain times, recycling and the climate emergency remain some of the most pressing issues we face and we must work to unite the world to think ‘resource not waste’ and protect the future of our planet.

“It is important that recyclers and the recycling industry aligns itself to the UN's key Sustainable Development Goals, and we pull together – across the planet – to work towards a cleaner, more sustainable and more ethical planet if we are to provide for the future and for our children.

“We know that from tiny acorns mighty oaks grow, which is why our #RecyclingHeroes campaign focuses on the unsung heroes, those people, businesses and communities amongst us all, that put sustainability and environmental good practice at the heart of all we do.  Let the 18th of March 2020 be a day to thank them all.”

Last week, Sustainability in Packaging, an event that took place March 11-13 in Chicago, provided insights from brand owners, retailers, packaging manufacturers, government regulators and nongovernmental organizations on trends in sustainable packaging. 

Andrew Kern, procurement manager at Smurfit Kappa, which has headquarters in Ireland, presented on March 13 in a session titled Navigating the Sustainability Ecosystem. Kern is part of a team responsible for procuring fiber for the company's 100 percent recycled containerboard mill in Forney, Texas, as well as its other mills throughout the Americas and Europe. During the session, Kern discussed three critical obstacles in packaging that impact the recycling industry: critical mass, too many choices and contamination. 

He said the critical mass and too many choices challenges tie into the challenge of contamination. 

“With critical mass, you have to have a volume of material to economically have a solution for most recyclable materials,” said Kern “So, that’s part of why we have [single-stream recycling]—it helps us overcome that critical mass. But the byproduct of that is we end up with contamination. Also, a lot of contamination is due to over-choice [with packaging options]. Over-choice tends to lead to poor and wrong choices with recycling, which leads to contamination.”

In the presentation, Kern also shared some myths in the session around sustainable packaging, including:

• Collection of recyclable materials equates to recycling.

• Preconsumer recycled materials and postconsumer recycled materials are equal.

• Biodegradable and biocompostable are the same thing.

Kern said he’s even noticed people in the recycling industry share these myths at times. 

“I’m amazed at how often I even see in our own recycling industry the idea that collection equals recycling,” he said. “Just because something is collected at a plant doesn’t always equate to it being recycled, either due to contamination before it comes to the plant or when at the plant. The other myth is that preconsumer materials that are recycled do not necessarily equal postconsumer materials that are recycled. Source-separated industrial materials frequently have end-use homes that don’t once they become comingled. 

“Then, the myth of biodegradable and biocompostable being the same thing—there’s a myth about how beneficial they are,” he continued. “A lot of biodegradable products out there turn into contamination [mixed] with their plastic counterparts.”

There are several ways to combat these myths. Kern suggested working with suppliers and recycling facilities to improve communication. At Smurfit Kappa, he said the company’s Better Planet Packaging initiative has helped to bust some of these myths.

“We had an event in November where we invited multiple packaging partners of ours to learn more about end life cycles of packaging,” Kern said. “That’s the encouraging piece. Companies involved in packaging are taking more interest in the end life cycle and wanting to understand it. There are still difficult choices to be made, but they are more involved in that. We’re encouraging that.”

Kern added that he has noticed some trends that may improve the sustainability of packaging. He said Amazon’s Frustration-Free Packaging model and similar design trends that use fewer types of materials help reduce contamination in recycling.

“We’ve even developed some packaging designs that utilize corrugated buffers instead of foam buffers in packaging to eliminate over choice,” he added. 

Another trend is the move toward using more recycled materials in packaging to improve sustainability, which he said is driven, in part, by increased consumer demand for recycled content in products.

However, some trends may not be as beneficial to recycling. Kern said there is a trend toward personalized packaging and box demand requirements by customers. “That’s a trend that could work for or against contamination issues, depending on the direction of personalization that goes into that,” he said. 

Overall, Kern said he wants to see more packaging trends alleviate contamination challenges faced by recyclers. He said, “My hope is some of these packaging trends ease the challenges of removing contamination. As packaging choices are made with more focus on end life cycles and better understanding them. Really, it’s not been verbalized, but the idea that they want to know it’s not just recovered but recycled to a new product…those are positives I think coming out of some of these packaging trends.”