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Foundry recycling could profit by aluminum's success.

Foundry Recycling Could Profit by Aluminums Success

"Over 26%, or five million tons, of the total U.S. consumption of aluminum used in 1989 was made up of new marketable and old scrap that had been recycled, and the recycling ratio will continue to grow to well over 30% in the 1990s," Laurence N. Roth, president of Roth Brothers Smelting Corp, East Syracuse, NY, revealed recently in a talk to a group of aluminum processors.

He cited the automobile industry as one reason why the percentage will grow, stating that there are more cars being produced, each with an ever-increasing aluminum content, and each will eventually find its way to the scrap recycler and the smelter's furnace. In fact, Roth estimated that there are 500 million cars in the world today, each containing an estimated 114 pounds of mixed aluminum alloys. That is an above-the-ground aluminum mine roughly equal to 25 million metric tons of aluminum to be recycled, nearly equal to two years of current Free World primary production.

The largest consumer of aluminum castings, 80% of which are secondary alloys, is the transportation sector. GM's annual purchase of all aluminum, directly or indirectly, is now at one billion pounds. That includes everything from scrap to highly value-added trim products. Roth cites a GM source as stating that 85% of that amount is secondary recycled aluminum, adding that in a few years 45% of blocks will be aluminum, 65% of heads and 100% of pistons are or will be aluminum, as will 100% of transmission housings.

The latest figures show that the average North American car contains 155 lb of aluminum, but what is obscured is the fact that 130 lb of that is secondary aluminum. Examples Roth cites of GM aluminum usage range from the "J" car with 75 lb of aluminum, the Allante with 500 lb and the Corvette using 600 lb. The 1991 Cadillac Northstar will contain 165 lb in the engine compartment alone and the Saturn, 105 lb in its engine compartment.

While transport accounts for about 60% of U.S. castings, it accounts for more than 80% in Japan and France, 75% in West Germany and 65% and 60% for Italy and Great Britain. Secondary casting alloys can be found in computer, electrical/electronic equipment, building and other industrial components, as well.

In 1988, secondary alloy production figures for Japan and North America were each nearly one million tons and 1.5 million tons in Europe, up 22% overall in the last decade, despite the fact that during this period some large automakers and some of their large casting suppliers produced their own alloys that are not included in this production.

In the U.S., there are 34 secondary smelters operating 44 plants, with a total capacity of 1.25 million net tons/year, 10-20% below equipment capacity.

The secondary recycling industry in the U.S. changed in the '80s. The number of companies was nearly halved as financial strength to ride out the downtimes preceding the last two years became a major factor. Except for rising capital needs, there are three major problems facing the secondary smelter in the next decade. Roth detailed these as follows.

Coping with the Environment--Like metal processors all over the world, the secondary smelter is constantly confronted with an increasing number of strictly monitored environmental requirements. He is the last in the recycling chain, fulfilling an eco-political demand for recycling in an efficient aluminum reuse industry. But using environmentally sound and efficient scrap processing equipment to handle the contaminated, low grade recycled aluminum is essential, not only for growth, but survival.

Technical Sophistication--The demand from a new generation of user for higher levels of metallurgical and technical requirements has arrived. New alloys, modifiers for grain structure, gas limits, quality assurance, backup laboratory equipment and technical assistance require the smelter of the '90s to be more skillful and to have a considerably larger investment in equipment and services to meet competitive market pressures.

Financial Strength--The secondary smelter must keep raw materials and finished inventory on hand, be able to withstand fluctuating prices and still be able to modernize and become more efficent.

According to Roth, the industry is scrap-driven. Scrap represents 80-85% of ingot selling price, and its availability determines ultimate pricing. He says the next decade looks promising and even if auto sales decline next year, the difference should be more than made up in the increased amount of aluminum per car.
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Publication:Modern Casting
Date:Feb 1, 1990
Words:744
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